Sonaselection India
What they do: The company is involved in the sale of services and products, with a focus on textiles. However, the business model's sustainability is questionable due to declining revenues and profitability.
By IPO Milega Research · Published · Updated
The company has shown a significant decline in revenue and profitability over the last three fiscal years.
- Listing gain
- +3.34%
- Listed at ₹102.31
- Subscribed
- 2.01x
- Total
- Retail odds
- 40%
- 1 in 2.5
GMP is an unofficial grey market indication.
- Price band
- Price TBA
- Lot size
- N/A
- Min. investment
- N/A
- Issue size
- 142 Cr.
- Open17 Sept 2026
- Close21 Sept 2026
- Allotment22 Sept 2026
- Listing24 Sept 2026
Overview
Estimated from the current subscription figures. Tap a category to work it out for your application size.
- QIB
- 1.16x
- NII
- 1.99x
- Retail
- 2.5x
₹99 (+0.00%)
GMP trend
Unofficial grey market quotes, times in IST
Outer ring: estimated gain
How the score adds up
The overall score is the average of these five, nudged by QIB demand once bidding closes.
- Financials3.0
- Performance8.0
- Flexibility8.0
- Timing7.0
- Risk4.0
The Grey Market Premium (GMP) suggests a potential gain of 7.07% on listing. This is supported by the company's strong performance and flexibility scores, indicating robust operational capabilities and market adaptability. However, financial fundamentals show declining revenue and profitability, which could temper gains.
Strengths4
- Transitioned from job-work to manufacturing model.
- Established a fully operational fabric manufacturing plant in July 2024.
- Achieved a high customer retention rate with 125 customers maintaining relationships for at least three reporting periods.
- Expanded into the readymade garments segment through a subsidiary.
Concerns5
- High customer concentration with top 10 customers contributing 33.80% of revenue.
- Dependence on top 10 suppliers for 68.92% of procurement.
- Geographic concentration in Rajasthan, affecting revenue and procurement.
- Exposure to foreign currency risk without hedging instruments.
- Interest rate risk from floating rate borrowings.
Who gets shares
- QIB50%
- NII15%
- Retail35%
- Retail Minimum-- lots, - shares
- Retail Maximum-- lots, - shares
- S-HNI Minimum-- lots, - shares
- S-HNI Maximum-- lots, - shares
- B-HNI Minimum-- lots, - shares
| Application | Lot size | Shares | Amount |
|---|---|---|---|
| Retail Minimum | - | - | - |
| Retail Maximum | - | - | - |
| S-HNI Minimum | - | - | - |
| S-HNI Maximum | - | - | - |
| B-HNI Minimum | - | - | - |
Timing
7.0/10The IPO is well-timed given the positive growth projections for the Indian textile industry and the company's alignment with sustainable product trends. However, potential investors should consider the company's operational risks and market dependencies.
- Time to market
- The timing is favorable due to the industry's projected growth and the company's strategic positioning in sustainable textiles. However, operational risks and market dependencies could affect the IPO's success.
- How allotment works
- Basis of allotment finalized and shares credited to demat
- Market timing
- Favourable
- Time to market
- 7.0
- Listing on
- BSE, NSE
Key milestones
- 17 Sept 2026IPO Opens
- 21 Sept 2026IPO Closes
- 22 Sept 2026Basis of Allotment
- 23 Sept 2026Refunds Initiated
- 23 Sept 2026Credit to Demat Account
- 24 Sept 2026Listing Date
Financials
3.0/10- Revenue
- ₹518 Cr
- +63.6%
- Profit after tax
- ₹34.02 Cr
- +83.3%
- Net margin
- 6.6%
- +0.7 pts
- Assets
- ₹475 Cr
- +26.7%
- Return on equity
- 39.05%
- Debt to equity
- 2.48
- Revenue CAGR
- -66.67%
- ROCE
- 19.69%
- Return on net worth
- 39.05%
- NAV per share (₹)
- 24.78
Financial performance trend
Amount ₹ in croresThe company has shown a significant decline in revenue and profitability over the last three fiscal years. The most recent fiscal year (FY2025) reported a net loss, indicating financial instability. The company's liabilities have increased, and the revenue trend is negative, which raises concerns about its financial health.
Risk
4.0/10Read this score as a safety rating: 10/10 means the lowest risk, 1/10 the highest.
Where the risks sit
- Financial risks2
- Market risks2
- Operational risks1
- Regulatory risks1
The company faces significant risks from customer and supplier concentration, geographic dependency, and financial exposures, but mitigates these through monitoring and strategic financial management.
How the company offsets these
The company manages risks through strategic financial monitoring and maintaining liquidity reserves.
Financial risks2
- Interest rate risk from floating rate borrowings.
- Credit risk from trade receivables and financial assets.
Market risks2
- High customer concentration with top 10 customers contributing 33.80% of revenue.
- Dependence on top 10 suppliers for 68.92% of procurement.
Operational risks1
- Geographic concentration in Rajasthan, affecting revenue and procurement.
Regulatory risks1
- Outstanding litigation related to employment termination under Industrial Dispute Act.
Performance
8.0/10Sonaselection India Limited, established in 2022, has rapidly transitioned from a job-work model to a manufacturing-led business, focusing on textile fabric production. The company has shown impressive growth in revenue and profitability, driven by strategic expansions and a strong customer base. Its operations are supported by advanced technology and a commitment to sustainability, positioning it well in the competitive textile industry.
- Historical growth
- The company has demonstrated significant growth in revenue and profitability, with a CAGR of 83.42% in revenue and 172.00% in profit after tax from FY23 to FY25., High
- Market comparison
- Sonaselection India Limited is positioned competitively within the textile industry, leveraging its integrated business model and strategic location in Bhilwara, Rajasthan, known as the 'Manchester of Rajasthan.'
- Future potential
- The company is well-positioned for future growth, supported by its expansion into the RMG segment and ongoing investments in sustainability and technology.
- Operational consistency
- The transition to manufacturing has allowed for greater control over production and quality, contributing to consistent revenue growth.
- Experience
- The management team is led by experienced promoters with over 30 years in the textile industry, supported by a skilled senior management team.
- Track record
- The management has successfully guided the company through strategic expansions and operational transitions.
Key achievements
- 01Transitioned from job-work to manufacturing model.
- 02Established a fully operational fabric manufacturing plant in July 2024.
- 03Achieved a high customer retention rate with 125 customers maintaining relationships for at least three reporting periods.
- 04Expanded into the readymade garments segment through a subsidiary.
Flexibility
8.0/10The company has shown strong market adaptability by transitioning from job-work services to manufacturing, expanding its product portfolio, and entering the RMG segment. It leverages India's growing textile industry and shifting global supply chains to enhance its market position.
The company has shown strong revenue growth with a CAGR of 83.42% from FY23 to FY25. However, its high debt-equity ratio, which peaked at 3.72 in FY24, indicates a reliance on debt financing, although it plans to use IPO proceeds to reduce debt.
Sonaselection has demonstrated operational agility by rapidly scaling its manufacturing capabilities and integrating advanced technologies. Its ability to maintain high capacity utilization rates and transition to manufacturing from job-work highlights its operational flexibility.
Sonaselection India Limited demonstrates significant flexibility and adaptability through its strategic initiatives and operational capabilities. The company has transitioned from job-work services to manufacturing, expanded its product portfolio, and integrated sustainability practices, positioning itself well in the competitive textile industry.
- Product diversification
- The company offers a diversified product portfolio including 100% cotton fabric, cotton lycra, cotton blends, and polyester blends, catering to various segments of the textile market.
- Future adaptability
- The company's focus on sustainability, renewable energy, and expansion into the RMG segment positions it well for future adaptability. Its strategic use of IPO proceeds to reduce debt and invest in new machinery further enhances its potential for growth and adaptation.
The data on this page has been reviewed manually by the IPO Milega research team. It is not investment advice, and IPO Milega accepts no responsibility for losses arising from any investment decision. Investments in the securities market are subject to market risks. Read all the related documents, including the full prospectus, carefully before investing.