The Borana Weaves IPO closes today, May 22, 2025, marking the end of the three-day bidding window. Investors are closely watching the subscription status and grey market premium (GMP) to decide whether to subscribe. The IPO aims to raise ₹144.89 crore through a fresh issue of 67.08 lakh equity shares. The price band is set at ₹216 per share, with a minimum lot size of 69 shares, requiring a minimum investment of ₹14,145 for retail investors.
Subscription Status
By the end of Day 2, the IPO had been oversubscribed by 29.46 times. The retail portion was subscribed 77.16 times, the Non-Institutional Investors (NII) category 53.07 times, and the Qualified Institutional Buyers (QIBs) category 1.76 times. According to chittorgarh.com, by 10:19:33 AM on Day 3, the IPO was subscribed 39.17 times, with the retail category reaching 93.15 times, QIBs at 1.82 times, and NIIs at 77.88 times. The strong subscription numbers indicate significant investor interest in the IPO.
Grey Market Premium (GMP)
The grey market premium (GMP) is an unofficial indicator of the expected listing gains. Today, the GMP for Borana Weaves IPO is ₹61 per share, an increase from ₹56 on Wednesday. This suggests that the shares are trading at ₹277 apiece in the grey market, a premium of 27.78% over the IPO price of ₹216 per share. A strong GMP usually signals positive market sentiment and potential for listing gains.
Financial Performance and Key Considerations
Borana Weaves reported robust financial performance for the nine-month period ending December 2024, with revenues of ₹215.71 crore and a net profit of ₹29.31 crore. The company's revenue increased from ₹135.53 crore in FY23 to ₹199.60 crore in FY24, a growth of 47.27%. Net profit also increased by 44.72% from ₹16.30 crore in FY23 to ₹23.59 crore in FY24.
Several brokerage firms have given positive reviews of the IPO. Lemonn Markets Desk noted the company's strong growth, healthy margins, and attractive GMP, making it a compelling short-term opportunity. Bajaj Broking has also advised investors to subscribe to the IPO with a long-term view, citing the company's good growth in income and profits.
However, potential investors should also consider certain risk factors. Borana Weaves relies heavily on the textile sector, which exposes it to market risks. The company also has limited geographical diversification compared to larger competitors and is vulnerable to raw material price fluctuations.
IPO Details
Borana Weaves plans to utilize the net proceeds from the IPO to finance the cost of establishing a new manufacturing unit in Surat, Gujarat, fund incremental working capital requirements, and for general corporate purposes. The allotment for the IPO is expected to be finalized on May 23, 2025, and the shares are expected to be listed on the BSE and NSE on May 27, 2025.
Final Thoughts
The Borana Weaves IPO has seen strong investor demand, as reflected in the high subscription rates and positive GMP. The company's financial performance and growth prospects appear promising, but investors should carefully evaluate the risks involved before making a decision. With the IPO closing today, potential investors need to consider all available information and decide whether to subscribe based on their own risk appetite and investment goals.
