The ₹26.73 crore IPO of Dhanwel Hybrid Seeds will open for subscription on Wednesday, with the grey market indicating a muted listing outlook. According to reports from The Economic Times, the company's shares were commanding a grey market premium (GMP) of 0%, suggesting no expected listing gains at current levels. The IPO is entirely a fresh issue of 27 lakh equity shares and will remain open for subscription till June 29. The company has fixed a price band of ₹95-99 per share, with shares proposed to be listed on the BSE SME platform on July 2, while the allotment is expected to be finalised on June 30.
Retail investors can bid for a minimum of 2,400 shares, requiring an investment of ₹2.38 lakh at the upper end of the price band, as reported by The Economic Times. The minimum application size for HNI investors is 3,600 shares, amounting to ₹3.56 lakh. The company plans to utilise the IPO proceeds towards repayment or prepayment of borrowings, funding working capital requirements and general corporate purposes. For this IPO, eligible investors can apply as Individual investors with a minimum investment range of ₹2-5 lakhs and lot size of 1,200 shares.
According to The Economic Times, the company operates as a seed producer with a diversified portfolio including groundnut, soybean, gram, sesame, wheat, green gram, black gram, fenugreek and cumin seeds. The company works with contract farmers for seed production, providing seed material and technical support while monitoring crop quality. The harvested seeds are processed at its manufacturing facility in Jashapar, Jamnagar, where they undergo cleaning, grading, treatment and packaging before being supplied to customers. The company offers a broad product range across multiple field crops and vegetables, including groundnut, soybean, sesame, wheat, gram, cumin, fodder, bajri, onion, and coriander. It holds ISO 9001:2015 certification for manufacturing, processing, and supply of seeds and follows quality control measures across sourcing, processing, and packaging operations.
For FY26, the company reported total income of ₹74.59 crore, up 69% from ₹44.13 crore in FY25, as reported by The Economic Times. Profit after tax surged 183% to ₹6.12 crore from ₹2.16 crore a year earlier, while EBITDA increased to ₹9.24 crore from ₹3.66 crore. However, the company reported negative cash flow from operating activities of ₹2.49 crore for FY26 and ₹6.06 crore for FY25 due to increased working capital requirements. The company's trade receivables stood at ₹8.46 crore as of FY26, while it had outstanding financial indebtedness of ₹7.68 crore. The company operates a working capital-intensive business with total requirements of ₹22.40 crore in FY26.
The company faces several operational risks including manufacturing capacity underutilisation - with actual production at 5,465 MTPA (55.77% utilisation) against installed capacity of 9,800 MTPA in FY26. The company derives 64.27% of revenue from top 10 customers and 58.55% of purchases from top 10 suppliers, increasing dependency risks. Revenue concentration shows significant exposure with top 10 customers contributing ₹47.94 crore in FY26. The company's operations are closely linked to agricultural cycles and monsoon patterns, with major transactions conducted in cash posing regulatory compliance risks. As per the latest reports, the company is involved in ongoing tax proceedings that could impact business prospects if adverse judgments occur.
