Borana Weaves IPO opens tomorrow: What GMP signals ahead of subscription?

The initial share sale of textile manufacturer Borana Weaves is set to open for public subscription on Tuesday, May 20, and will close on May 22. Bidding for anchor investors will open later today.

Ahead of the issue, the grey market premium (GMP) for the company's shares is around ₹55, indicating a 25.46% premium over the issue price.

The company has set a price band of ₹205 to ₹216 per equity share of face value ₹10 each for its Rs 145-crore maiden initial public offer. Investors can bid for a minimum of 69 shares and in multiples thereof.

The IPO is entirely a fresh issue of up to 67.08 lakh equity shares, according to the red herring prospectus.

Proceeds from the IPO will be utilised to finance the cost of setting up a new manufacturing unit to expand capabilities to produce grey fabric at Surat, Gujarat, funding incremental working capital requirements, and for general corporate purposes.

"Over the past few years, we have grown our manufacturing capabilities in the synthetic textile segment. The proceeds from the IPO will support the expansion of our production infrastructure and help us address our working capital needs."

"This step aligns with our long-term strategy of scaling operations while maintaining focus on product quality and operational efficiency," Borana Weaves’ Chairman and MD Mangilal Ambalal Borana said.

Incorporated in 2020, Borana Weaves engaged in the production of unbleached synthetic grey fabric. This fabric serves as a fundamental material for further processing, such as dyeing and printing, in various industries, including fashion, traditional textiles, home decor, and interior design.

Beeline Capital Advisors is the book-running lead manager, while Kfin Technologies is the registrar for the issue.

The allotment for the Borana Weaves IPO is expected to be finalised on May 23. Borana Weaves IPO will be list on BSE, NSE with a tentative listing date fixed as May 27.