The ₹141.6 crore Sonaselection India IPO has achieved 2.01 times subscription as of 17:30 PM on the final day of bidding on September 21, with the retail investor portion now 1.76 times subscribed. As per Business Standard, the issue received bids for 2.01 crore shares against 1 crore shares on offer, with the retail investor category leading demand at 1.76 times subscription against the 50.05 lakh shares reserved for retail investors. The non-institutional investor (NII) category stands at 1.05 times subscription against 21.45 lakh shares on offer, while the qualified institutional buyers (QIB) portion is subscribed 0.46 times against 28.60 lakh shares. The grey market premium (GMP) has remained flat at ₹0, indicating a potentially flat listing at the upper price band of ₹99 per share when shares debut on September 24 on both NSE and BSE.
Despite the company's strong growth trajectory, brokerages have assigned 'Neutral' ratings to the IPO citing cash flow concerns. SBI Securities highlighted that the company reported negative operating cash flows of ₹14.2 crore in FY25 and ₹110 crore in FY26, alongside elevated leverage and high working capital intensity with inventory days of 109 and receivables days of 73. The brokerage noted concerns regarding high geographic concentration in Rajasthan, with FY26 revenue and purchases contribution at 37.3% and 96% respectively. Swastika also raised concerns about the company's heavy reliance on limited key customers without long-term supply contracts, though it acknowledged the company's integrated manufacturing facility and diversified product portfolio spanning cotton, lycra, polyester blends, and ready-made garments.
The company demonstrated robust financial growth during FY24-26, with revenue, EBITDA and PAT CAGR of 107%, 73%, and 61% respectively, driven by its transition to a manufacturing-led business model. According to The Economic Times, the company reported a consolidated net profit of ₹34.02 crore and sales of ₹517.60 crore for the twelve months ended March 31, 2026, compared with ₹316.47 crore in FY25. The IPO is priced at a price band of ₹94-99 per share, with investors able to bid in lots of 150 shares, meaning retail investors require a minimum investment of ₹14,850 for one lot. The bidding will remain open until September 21, 2026. Profitability also improved significantly, with EBITDA rising to ₹84.77 crore in FY26 from ₹58.12 crore in the previous year, reflecting notable improvement in the company's overall earnings performance.
According to the company's disclosures, Sonaselection India will utilize ₹80 crore of proceeds from the net issue for repaying partial debt. The company's total outstanding borrowings as of July 2026 stood at ₹263.8 crore. The remaining funds will be allocated for capital expenditure towards purchase of plant and machinery at the existing manufacturing facility in Bhilwara, Rajasthan, with ₹50.61 crore specifically earmarked for this purpose. The company operates a manufacturing facility in Bhilwara, Rajasthan, which is known as the 'Vastranagari', with an installed processing capacity of 82.44 million meters per annum and capacity utilization of 82.71% in FY2026. The CAPEX is primarily to modernize the plant and there will not be any increment in the overall production capacity of the company pursuant to the installation of the proposed machinery. The total issue size amounts to ₹141.6 crore with the remaining proceeds allocated for general corporate purposes.
Rajasthan-based textiles company Sonaselection India successfully raised ₹42.47 crore via anchor book allocation on September 16, ahead of its initial public offering opening. According to The Economic Times, the company allocated 42.90 lakh shares at ₹99 each to three anchor investors, with the board allotting 42.90 lakh shares at ₹99 each to 3 anchor investors. Astorne Capital emerged as the largest investor, investing ₹22.7 crore for 22.96 lakh shares, while India Max Investment Fund and Lords Multigrowth Fund each invested ₹9.86 crore for 9.96 lakh shares each. The company had finalised the allocation of 42.9 lakh shares to three anchor investors at the upper end of the price band. With the grey market premium at ₹0, the stock is showing positive but more measured market sentiment ahead of its listing on September 24 on both NSE and BSE. Choice Capital Advisors Pvt. Ltd. serves as the book-running lead manager for the issue, while KFin Technologies Ltd. has been appointed as the registrar.
