The IPO market continues to remain active as Spunweb Nonwoven Limited gears up to launch its public issue next week, aiming to capitalise on its leadership position in technical textiles and hygiene-based nonwoven products. The issue is likely to attract investor attention given the company’s strong order book, export focus, and the rising use of spunbond nonwoven fabrics in hygiene, medical, packaging, and industrial segments.
Key IPO details
According to market sources, Spunweb Nonwoven IPO is scheduled to open on Monday, 15 July 2025, and will close on Wednesday, 17 July 2025. The company aims to raise Rs 120 crore, comprising a fresh issue of Rs 80 crore and an Offer for Sale (OFS) of Rs 40 crore by promoter group shareholders to achieve listing gains and partial exit.
| IPO Parameters | Details |
|---|---|
| Issue Size | Rs 120 crore |
| Fresh Issue | Rs 80 crore |
| OFS | Rs 40 crore |
| IPO Open Date | 15 July 2025 |
| IPO Close Date | 17 July 2025 |
| Price Band | Rs 68 – Rs 72 per share (expected) |
| Lot Size | 2000 shares |
| Minimum Investment | Rs 1,36,000 (at upper band) |
| Allotment Date | 18 July 2025 (tentative) |
| Listing Date | 22 July 2025 (tentative) |
| Lead Managers | SMC Capitals |
| Registrar | KFin Technologies |
Grey market premium (GMP) trends
Market observers report that Spunweb Nonwoven IPO is commanding a GMP of Rs 5-6 per share, indicating a 7-8% premium over the upper price band of Rs 72. While modest, the GMP shows positive sentiment in the SME IPO category driven by recent successful listings in textile manufacturing and specialty chemicals.
About Spunweb Nonwoven Limited
Founded in 2013, Spunweb Nonwoven is engaged in the manufacturing of polypropylene spunbond nonwoven fabrics, primarily catering to hygiene (baby diapers, sanitary napkins), medical (surgical gowns, masks, drapes), agriculture (crop covers), and packaging sectors. The company operates a manufacturing unit in Gujarat with a capacity of 18,000 MT per annum.
Business strengths:
- High-margin hygiene and medical segments, contributing nearly 60% of FY24 revenues.
- Strong export focus, with over 35% of revenues coming from Southeast Asia, Africa, and Europe.
- Established client base with long-term supply contracts with multinational FMCG and medical companies.
- Expansion plans to introduce meltblown fabric lines for N95 mask raw materials.
- Backward integration strategy to set up a polypropylene resin compounding unit by FY27.
Financial performance
| Financial Metrics (Standalone) | FY23 | FY24 |
|---|---|---|
| Revenue | Rs 225 crore | Rs 278 crore |
| EBITDA | Rs 34 crore | Rs 46 crore |
| EBITDA Margin | 15.1% | 16.5% |
| PAT | Rs 17 crore | Rs 23 crore |
| ROE | 17.4% | 18.8% |
The company recorded a 23% CAGR in revenue over FY21-24, driven by rising demand for hygiene products and increased exports post-pandemic. Its PAT margins remain stable at ~8.3%, supported by operational efficiencies and favourable input costs.
Utilisation of IPO proceeds
The fresh issue of Rs 80 crore will be utilised for:
- Rs 50 crore: Expansion of manufacturing capacity to 25,000 MT per annum by FY26.
- Rs 15 crore: Working capital requirements to cater to increased order inflow.
- Rs 5 crore: Technological upgrades for value-added products like laminated nonwovens.
- Rs 10 crore: General corporate purposes.
Competitive landscape
India’s nonwoven industry is expected to grow at a CAGR of 10-12% till FY30, supported by:
- Rising demand in hygiene and medical sectors post-pandemic.
- Shift towards disposable nonwoven products for infection control.
- Strong push under Make in India and medical textiles PLI schemes.
| Key Players | Segment Focus |
|---|---|
| Spunweb Nonwoven | Spunbond PP nonwovens |
| Welspun India | Hygiene, geotextiles |
| Ginni Filaments | Medical, hygiene nonwovens |
| Supreme Nonwovens | Automotive and industrial nonwovens |
| Uniproducts | Automotive and home furnishing |
Expert views: Should you subscribe?
✅ Angel One: “Spunweb Nonwoven has shown consistent growth in revenues and PAT, with strong demand visibility in hygiene and medical segments. Valuations at ~18x FY24 earnings are reasonable. Recommended for long-term investors.”
✅ Motilal Oswal: “The company’s expansion plans and export focus are positives. However, raw material price volatility and forex risks remain concerns. Investors with a moderate risk appetite may subscribe.”
✅ HDFC Securities: “With a robust order book, stable margins, and sectoral tailwinds, Spunweb Nonwoven IPO offers decent prospects. Listing gains are likely to be modest; subscribe for long-term portfolio allocation.”
Risks to consider
- Raw material dependency on imported polypropylene resins, exposing it to forex and crude price volatility.
- Competition from Chinese and Southeast Asian manufacturers in export markets.
- High working capital requirements due to elongated export receivables cycle.
- Any regulatory changes in medical textile standards or hygiene norms impacting product certifications.
Conclusion
The upcoming Spunweb Nonwoven IPO presents an opportunity to invest in India’s growing technical textile and nonwoven fabrics sector, driven by rising hygiene consciousness, medical sector growth, and government support for domestic manufacturing. While the IPO has garnered modest GMP premium, the real value lies in its expansion plans and sectoral growth prospects.
Investors are advised to analyse their risk appetite, sector exposure, and financial goals before investing.
Disclaimer: This news article is for informational purposes only and does not constitute investment advice. Investors must refer to the company’s RHP, consult financial advisors, and consider market risks before subscribing to the IPO.
