Sahaj Fashions Limited IPO - Review, Valuation & GMP Todays

Sahaj Fashionss Limited - Complete Overview

Established in 2011, Sahaj Fashions Limited specializes in producing high-quality fabric for various applications, including garments, home furnishings, and industrial uses.

The company's expertise lies in the manufacturing of predominantly cotton suiting fabric and cotton shirting fabric, alongside polyester-based and cotton-polyester blended fabrics.

Additionally, the company is involved in crafting cotton yarn-dyed fabrics, which are highly sought after in the garment manufacturing sector. The company distributes its products not only within its home state of Rajasthan but also in other regions such as Gujarat, Maharashtra, and Delhi.

The company’s manufacturing facility is located in Kishangarh, Bhilwara Express Highway i.e. NH 79, at village Srinagar District Ajmer. 

 

What does the company do? 

Sahaj Fashions Limited is actively involved in the production of premium-quality fabric utilized for a wide range of applications, including garments, home furnishings, and industrial uses, among others.

 

Company Products

Sahaj offers a diverse array of products, encompassing Piece Dyed Shirtings, Cotton Yarn Dyed Shirtings, Cotton Yarn Dyed Chambray, and Cotton fabric for Self Designed Shirting, spanning from count 40s to 100s within the Shirtings category. The Suitings segment includes Cotton Spandex Fabric, Cotton Suiting Fabric, Cotton Dobby Designs, and Cotton Power Lycra Fabrics. In the Fancy Fabrics category, the offerings consist of Slub Yarn Fabrics and Linen Fabrics. The Industrial Cloth segment encompasses Cotton Duck Fabric, Cotton Drill Fabric, Cotton Twill Fabric, and Cotton Tusser Fabric.

 

 

IPO Overview

Sahaj Fashions Ltd's upcoming IPO is scheduled to take place from August 21st to August 24th, 2023. The company set an issue price of Rs 30 per share with a face value of Rs 10 per share.

The IPO's total issue size is 4,400,000 shares, amounting to Rs 13.20 Cr. The company has allocated 50% of its shares to retail investors and the remaining 50% to other investors.

The anticipated listing date for Sahaj Fashions Ltd's IPO on the NSE SME is September 1st, 2023.

 

Sahaj Fashionss Limited IPO timetable (Tentative)

EVENTS	DATE
IPO Opening Date	21 August 2023
IPO Closing Date	24 August 2023
IPO Allotment Date	29 August 2023
Refund initiation	30 August 2023
IPO Listing Date	01 September 2023

 

Sahaj Fashionss Limited IPO Details

IPO Opening & Closing Date	21 August to 24 August 2023
Face Value	Rs. 10 per share
Issue Price	Rs. 30 per share
Lot Size	4000 Shares
Price of 1 Lot	Rs. 120,000
Issue Size	4,400,000 shares (aggregating up to Rs13.20 Cr)
Offer for Sale	NA
Fresh Issue	[.] shares (aggregating up to Rs 0.00 Cr)
Listing at	NSE SME
Issue Type	Fixed Price Issue IPO
Registrar	Bigshare Services Pvt. Ltd.

 

Sahaj Fashionss Limited IPO Lot Details

Minimum Lot Investment (Retail)	1 Lot
Maximum Lot Investment (Retail)	1 Lot
Minimum Lot Investment (HNI)	2 Lot

 

Sahaj Fashionss Limited IPO Reservation

Other Investors Portion	50%
Retail Portion	50%

 

Company Financial

Amount in Lakhs

Period	FY 21	FY 22	FY 23
Total Assets	6711.73	6998.59	6891.19
Total Revenue	7475.54	8698.36	6112.27
PAT	32.14	41.90	214.32
Net Worth	1395.90	1437.40	1651.72
Reserve & Surplus	654.68	696.18	910.50
Total Borrowings	1608.65	1795.46	1588.99

 

Costs of material consumed and revenue generated from top customers

(Amount in Lakhs)

Particulars	For the period ended November 30, 2022	FY 22	FY 21
Total Revenue	6,108.76	8698.36	7475.54
Cost of Material Consumed	5,293.98	7649.10	6426.31
Revenue from Top 10 Customers	3454.72	4,438.64	6,773.48

 

Revenue from operations and total income of Sahaj Fashionss Limited

(Amount in Lakhs)

Particular	From April 01, 2022 to November 30, 2022	2021-22	2020-21
Sale from Manufactured Goods	6,108.76	8,695.75	7,470.44
Sale from Traded Goods	Nil	Nil	Nil
Total Revenue	6,108.76	8,695.75	7,470.44
Profit After Tax	214.32	41.90	32.14

 

Objective of the Issue 

The company will use the funds for the following purposes:

• Fulfilling the Company's working capital needs.

• Prepaying or repaying specific borrowings obtained by the Company.

• Serving general corporate purposes.

• Covering the expenses related to the offer.

 

Promoters and Management of Sahaj Fashionss Limited

The company's promoters comprise Mr Rohit Toshniwal, Mr Norat Mal Choudhary, Ms Prabha Lakhotia, and Ms Sadhana Toshniwal.

Pre-issue Promoters Holding	100.00%
Post-issue Promoters Holding	70.01%

 

Peer Comparison

The following are the peers as per the Sahaj Fashionss Limited DRHP:

Company Name	EPS (Rs.)	P/E Ratio	Total Income (Rs. in Lakhs)
Sahaj Fashionss Limited	2.89	8.65	6112.27
Arvind Limited	8.55	11.16	4,54,180.00
RSWM Limited	38.85	5.56	2,01,841.00
Vardhman Textiles Limited	18.77	17.98	4,42,450.00

 

IPO's Valuations

As of November 30, 2022, Sahaj Fashionss Limited has an EPS of Rs 2.89 and a PE ratio of 8.65. Evaluating this data for IPO valuation suggests a share price of around Rs 25. However, the company has chosen to set the issue price at Rs 30, indicating a higher valuation for the IPO.

 

Dividend Policy

No dividends were distributed by the company in past years, and any potential future dividend payments will depend upon the company's financial performance.

 

IPO's Strengths

• The company possesses advanced international loom technology for fabric manufacturing.
• The company has taken measures to guarantee customer satisfaction, including addressing individual customer requirements and ensuring on-time order delivery.
• Through a process of backward integration, the company has established a sizing plant, which is a pre-process of fabric weaving in the manufacturing process.
• The company efficiently addresses fabric demand that exceeds its existing production capacity.
• SAHAJ boasts an extensive fabric portfolio, encompassing products like Cotton Shirting Fabric, Cotton Suiting Fabric, Cotton Lycra Fabrics, Polyester Uniform Fabric, and more.

 

IPO Weaknesses

• The Company is currently involved in ongoing legal proceedings, which include its Promoters and Directors.
• The company's profits exhibit fluctuating patterns.
• The Company heavily depends on a relatively small customer base.
• The company needs to obtain, renew, or maintain the statutory and regulatory licenses, permits, and approvals.
• The shareholding of both the Company's Promoter and Promoter Group is listed as part of the Public Category in the records of both Depositories.
• Under its financing arrangements, the lenders have imposed specific restrictive conditions on the company.
• Negative cash flows were experienced by the Company in past years.
• The Company has not made the required provision for Gratuity Payment, as mandated by The Payment of Gratuity Act 1972. Additionally, non-compliance with AS-15 - Employee Benefits, as issued by ICAI, has been noted.
• In the past, the Company submitted a Draft Prospectus and received preliminary approval from NSE. However, due to market conditions, the plan for listing was postponed.
• The Company has not fulfilled the requirement of filing the MSME-1 form as mandated by the MSME Act, 2006.
• The Restated Financial Statements of the Company have been prepared and endorsed by a Peer Reviewed Chartered Accountant who is not the Statutory Auditor of the Company.
• The Company faces competition from domestic competitors within its business sector.
• The Company has obtained certain unsecured loans that are subject to potential recall by the lenders at any given time.

 

 

IPO GMP Today

Latest GMP of Sahaj Fashions Ltd IPO is Rs.3.

 

Conclusion

The Sahaj Fashions Ltd IPO offers an opportunity for investors to invest in the garment manufacturing industry. The company operates in a highly competitive market and has experienced negative cash flow in the past. However, the decision to invest in the issue depends on various factors, and investors should carefully consider all these factors before investing in the IPO.

 

Finowings IPO Analysis

Hope you enjoyed the Finowings IPO Analysis. We tried our best to give every required detail about the company that you should know before applying to the IPO. 

You must consult your financial advisor before making any financial decisions. 

To Apply for the IPO, Click Here.

 

To Read the Prospectus of the Company Click Here to Download the DRHP

 

 

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