Sahaj Fashions had a lackluster debut on NSE Emerge at Rs 31 from its issue price of Rs 30 and dropped more than 4% to Rs 29.55 at 10:15 am on September 6.
The company went public on August 25 to raise Rs 13.96 crore. The offer is largely a new issue for the company, with the offer for sale being just Rs 53 lakh.
The warm listing came despite the issuance of a bid of 3.42 crores of shares, 7.7 times larger than the size of the IPO. Retail investors are very active, buying 11.7 times their stock. The Rajasthan-based polyester and cotton-polyster blend manufacturer will use the proceeds from the issuance primarily to meet working capital needs and repay debt. The remaining funds will be used for general corporate purposes and for incentive-related expenses.
In the financial year ending March 2023, the company’s revenue increased 4.63% year-on-year to Rs 91.01 crore. In fiscal year 20, the company’s revenue was higher at Rs 99.33 crore. Its profit after tax has more than doubled to Rs 2.89 crore in fiscal year 23 from Rs 43 lakh a year ago. The company has posted a net profit margin of over 3% in the current year only, while the net profit margin of previous years is less than 1%.
None of the analysts mentioned this IPO.
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