 "Sanathan Textiles shares list at 31% premium on NSE; follow GMP trend")
Sanathan Textiles shares made a sublime debut on Dalal Street on Friday, December 27, 2024. The company's stock listed at Rs 419 a piece, reflecting a premium of Rs 102 or 30.5 per cent against the issue price of Rs 321.
On the NSE, the stock was listed at Rs 422.30, a premium of Rs 101.30 or 31.5 per cent against the issue price.
The listing followed grey market trends, as the company's shares were trading at Rs 408 a piece in the grey market, indicating a premium (GMP) of Rs 87 or 27.1 per cent over the issue price of Rs 321, according to sources tracking unofficial markets.
Analysts say that Sanathan Textiles listing was above street expectation, backed by reasonable valuations compared with peers which are trading at premium and the company has left something on the table for new investors to gain on listing day.
"Considering market sentiments, we recommend conservative allotted investors can think of booking profits over and above our expectations. While long term investors should consider to 'Hold' it for long term despite knowing short term volatility & risk in the markets. For non-allotted investors, we advise to accumulate if we get dips post listing due to profit booking attempts," said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.
The Rs 550 crore IPO of Sanathan Textiles comprised a fresh issue and an offer for sale of equity shares. The IPO, offered in a price band of Rs 305-Rs 321 with a lot size of 46 shares, opened on Thursday, December 19, 2024, and closed on Friday, Monday, December 23, 2024, with an overall subscription of 36.9 times. Also Read: DAM Capital Advisors IPO Listing
As per NSE data, Qualified Institutional Buyers (QIBs) showed the highest demand, subscribing to 79.59 times the quota reserved for them. This was followed by Non-Institutional Investors (NIIs) at 44.39 times, and Retail Individual Investors (RIIs) at 9.31 times.
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KFin Technologies served as the registrar for the issue, while Dam Capital Advisors Ltd (Formerly Idfc Securities Ltd), ICICI Securities Limited acted as the book-running lead managers.
In its Red Herring Prospectus (RHP), Sanathan Textiles stated that it would use the proceeds from the fresh issue for the repayment or prepayment, in full or part, of certain outstanding borrowings and for general corporate purposes.Investment in our subsidiary and general corporate purposes. Also read: Mamata Machinery IPO Listing
Founded in 2005, Sanathan Textiles Limited specializes in manufacturing polyester yarn and supplying cotton yarn globally. The company operates across three distinct business verticals: (a) Polyester yarn products, (b) Cotton yarn products, and (c) Yarns for technical textiles and industrial applications. These technical textiles cater to diverse sectors, including automotive, healthcare, construction, sports, outdoor activities, and protective clothing.
As of September 30, 2024, Sanathan Textiles offered over 3,200 active yarn product varieties (produced between April 1, 2021, and September 30, 2024) and maintained more than 45,000 stock-keeping units (SKUs). The company also possesses the capacity to manufacture a versatile range of over 14,000 yarn product varieties and 190,000 SKUs for various applications and end-use purposes.