A Bhilwara-based integrated fabric manufacturer opens its Rs 141.57 crore mainboard issue on September 17
Sonaselection India Ltd (SIL) is an integrated fabric manufacturing and processing company producing value-added textile products — converting raw and greige fabric into finished, high-quality fabrics using advanced technology, established production capabilities and stringent quality systems.
It positions itself as a preferred partner for brands seeking consistency, innovation and faster delivery, on the back of a diversified product portfolio and reliable, cost-efficient solutions.
The product range spans woven and processed fabrics. SIL manufactures 100% cotton fabric, cotton lycra (stretch) fabric, cotton blends and polyester blends, and processes 100% cotton, cotton blends, polyester-viscose (P/V) and polyester fabric.
Its model combines in-house processing with outsourced greige-fabric sourcing (or outsourced conversion from yarn), giving it flexibility, cost efficiency and consistent quality.
It operates one manufacturing facility in Bhilwara, Rajasthan, with an installed processing capacity of about 82.44 million metres per annum, and holds global certifications including GOTS, GRS and OEKO-TEX — credentials that matter for supplying quality-conscious and export-oriented brands.
More recently, it expanded downstream into readymade garments (RMG) through a subsidiary incorporated in July 2025, aligning fabric specifications with garment production (currently menswear across age groups). It had 979 employees plus 102 contractual workers as of July 31, 2026, and the promoters are the Nuwal family (Harshil Nuwal, Subhash Chandra Nuwal, Uma Nuwal), Deepank Bhandari and Sona Polyspin.
Issue Details
| Particulars | Details |
|---|---|
| Issue Opens | September 17, 2026 |
| Issue Closes | September 21, 2026 |
| Listing | BSE, NSE (Mainboard) |
| Listing Date | September 24, 2026 |
| Price Band | Rs 94 – Rs 99 per share |
| Face Value | Rs 10 |
| Issue Size | Rs 141.57 crore (1,43,00,000 shares, entirely fresh) |
| Min. Application | 150 shares (multiples thereafter) |
| Min. Retail Investment | Rs 14,850 |
| IPO as % of Post-IPO Capital | 25.16% |
| Post-IPO Market Cap | Rs 562.60 crore |
| Lead Manager | Choice Capital Advisors Pvt. Ltd. |
| Registrar | KFin Technologies Ltd. |
The issue is entirely a fresh issue. From the net proceeds, SIL will utilise Rs 80.00 crore for repayment or prepayment of certain borrowings and Rs 50.61 crore for capex on plant and machinery, with the rest for general corporate purposes — a deleveraging-and-capacity use of proceeds. Post-IPO, paid-up equity rises from Rs 42.53 crore to Rs 56.83 crore.
Price Band
At the upper band of Rs 99, on FY26 earnings the issue is valued at a P/E of about 16.53x, with a P/BV of 4.00 on the March 31, 2026 NAV of Rs 24.78, easing to 2.27x on the post-IPO NAV of Rs 43.62 (RoNW ~39%). On the cleaner FY25 base the P/E jumps to 30.28x — so on recent average earnings, analysts read the issue as aggressively priced.
GMP Watch
Grey-market interest has been minimal. In tracked data, the Sonaselection India IPO GMP stood at around ₹5 (~5% premium) as of opening, having been ₹0 in earlier readings — implying little to no listing gain over the Rs 99 upper band (an indicative listing near ₹104).
Financial Performance
| Particulars (Rs cr) | FY24 | FY25 | FY26 |
|---|---|---|---|
| Total Income | 121.31 | 316.47 | 517.60 |
| Net Profit (PAT) | 13.10 | 18.56 | 34.02 |
| PAT Margin (%) | 10.82 | 5.88 | 6.58 |
| RoCE (%) | 16.18 | 16.97 | 19.69 |
The top-line growth has been explosive — total income more than quadrupled from Rs 121.31 crore in FY24 to Rs 517.60 crore in FY26 (a huge jump as the company transitioned from job-work to manufacturing) — and PAT rose from Rs 13.10 crore to Rs 34.02 crore. On the face of it, impressive. But there are two clear caveats.
First, the margin pattern is uneven: PAT margin actually fell from 10.82% (FY24) to 5.88% (FY25) before recovering to 6.58% (FY26), so the revenue explosion came at lower profitability, characteristic of the shift toward higher-volume manufacturing and the competitive, fragmented textile segment.
Second, the bumper FY26 net profit (nearly doubling) in the immediate pre-IPO year is precisely the kind of surge analysts flag as possible window dressing to pave the way for a fancier valuation — its sustainability is the central question.
The company reported an average EPS of about Rs 6.11 and an average RoNW of 37.63% (flattered by the profit surge). A year-on-year jump in trade receivables remains a cash-quality concern, and contingent liabilities stood at Rs 20.01 crore. The company has no dividend history.
Peer Comparison
The offer document lists Vishal Fabrics, Sangam (India) and Nitin Spinners as peers, trading at P/Es of roughly 14.6x, 23.0x and 17.3x (as of September 11, 2026). These differ in scale and product mix, so the comparison isn’t strictly apples-to-apples — SIL’s ~16.5x FY26 P/E sits mid-range, but its ~30x FY25 P/E (the cleaner base) is well above the peer set, underscoring the aggressively-priced read.
Risks to Consider
Margin sustainability is the headline risk. The bumper FY26 profit, concentrated in the pre-IPO year, has the hallmarks of possible window dressing, and margins have been volatile (dropping to 5.88% in FY25) — so the durability of both the growth and the profitability is the central question in a fragmented, competitive segment.
Aggressive valuation. On the cleaner FY25 base the P/E is ~30x, rich for a young, thin-margin textile processor, and well above listed peers — leaving little cushion if margins normalise.
Young company and acquisition-based history. SIL was incorporated only in 2022 and built its base via a slump-sale acquisition, so its standalone corporate track record is short, and the rapid scale-up is recent and unproven across a full cycle.
Receivables and contingent-liability flags. A year-on-year surge in trade receivables raises a cash-conversion concern, and the Rs 20.01 crore contingent liability warrants scrutiny.
Raw-material and single-facility risks. Margins are exposed to cotton/yarn and polymer input-price volatility, and all manufacturing runs from a single Bhilwara facility (geographic/concentration risk).
