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Neelam Linens and Garments (India) Ltd IPO
Status: Closed
Overview
IPO date
08 Nov 2024 to 12 Nov 2024
Face value
₹ 10 per share
Price
₹ 20 to ₹24 per share
Issue Size
5,418,000 shares
(aggregating up to ₹ 13 Cr)
(aggregating up to ₹ 13 Cr)
Allotment Date
13 Nov 2024
Listing at
NSE
Issue type
Book Building - SME
Sector
Textiles
Objectives of Neelam Linens and Garments (India) Ltd IPO
Initial public issue of up to 54,18,000^ equity shares of face value of
Rs. 10 each ("Equity Shares") of Neelam Linens and Garments (India) Limited ("Company") for cash at a price of Rs. 24 per equity share (including a share premium of Rs. 14 per equity share) ("Issue Price") aggregating up to Rs. 13.00 crores of which up to 2,76,000 equity shares of face value of
Rs. 10 each for cash at a price of Rs. 24 per equity share including a share premium of Rs. 14 per equity share aggregating to Rs. 0.66 crores will be reserved for subscription by market maker to the issue (the "Market Maker Reservation Portion"). The issue less the market maker reservation portion i.e. net issue of 51,42,000 equity shares of face value of Rs. 10 each at a price of Rs. 24 per equity share aggregating to Rs. 12.34 crores is herein after referred to as the "Net Issue". The issue and the net issue will constitute 26.80% and 25.43% respectively of the post issue paid up equity share capital of the company.
Neelam Linens and Garments (India) Ltd IPO Strategy
- Selling directly to customers via our own stores.
- Continue improving financial performance through focus on operational and functional efficiencies.
- Continue to add to product portfolio by introducing new products.
- Improving & maintaining functional efficiencies.
About Neelam Linens and Garments (India) Ltd
Neelam Linens and Garments (India) Limited was incorporated as Private Limited Company under the name 'Neelam Linens and Garments (India) Private Limited', and Certificate of Incorporation was issued by the Registrar of Companies, Mumbai on September 22, 2010. The status of the Company was changed to PublicLlimited and the name of Company was changed to 'Neelam Linens and Garments (India) Limited' vide dated August 12, 2022. The fresh Certificate of Incorporation consequent to conversion was issued on September 01, 2022 by the Registrar of Companies, Mumbai.
The Company operate as a soft home furnishing company based out of Maharashtra, India, extending our services to a global clientele, USA and Australia and Far East. It specialize in the processing, finishing and supplying of bedsheets, Pillow cover, Duvet Cover, Towels, Rugs, Doher, Shirts & Garments predominantly for discounted retail outlets. It source surplus or slightly imperfect fabric from the domestic market, applying value-added services such as dyeing, stitching, embroidery, and other enhancements. Subsequently, it distribute these refined products to discounted retail outlets in diverse countries.
The Company operate two manufacturing operations at Bhiwandi, Thane. Unit I is engaged in cutting fabric and stitching whereas Unit 2 has checking department and packing department. The Company has products following, Bed Sheets, Towels, Pillow covers, Rugs, Hand towels / napkins, Doher, Shirts and T-shirts. The process of Bedsheet, Pillow covers, Shirts and T-shirts are processed at our units and other products are just procured readily and sold after the process of thread cutting, final quality check and packaging by the Company.
The Company has entered the apparel industry by starting an in-house production of men's and women's fashion apparel since 2023.
The Company is proposing the Public Issue of 60,00,000 Fresh Issue Equity Shares.
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T&C*
Strengths vs Risks of Neelam Linens and Garments (India) Ltd
Know the pros & cons
Strengths
Purchase of higher quality thread count fabric at lower price.- Experienced promoters and dedicated employee base.
- Infrastructure and Integrated capabilities to deliver quality Products.
Risks
- Its business predominantly focuses on bedsheets, which makes the company particularly susceptible to fluctuations in demand. Any shifts in consumer preferences have the potential to significantly impact its business, as well as influence its operational outcomes and financial standing.
- A majority of its supplies for the company operations are obtained from a limited number of suppliers.
- The company is dependent on a few customers for a major part of its revenues. Further the company does not enter into long-term arrangements with its customers could adversely affect its business and results of operations.
- The majority of the business of sale of licenses of our company occurs from the trading activity.
- The Company and the promoters does not have enough documentary evidence for the Capital Built-up of the Company.
- A significant portion of its sales are derived from India and any adverse developments in this market could adversely affect its business.
- The company has only one production unit that is located in Bhiwandi and any localized social unrest, natural disaster or breakdown of services or any other natural disaster in and around Ahmednagar or any disruption in production at, or shutdown of, its production unit could have material adverse effect on the company's business and financial condition.
- Its success depends on third party logistics and transportation infrastructure. Disruption of logistics and transportation services could impair the ability of its suppliers to deliver raw materials or the company's ability to deliver products to its customers and/ or increase the company transportation costs, which may adversely affect its operations.
- If the company is unable to maintain an optimal level of inventory, its business, results of operations and financial condition may be adversely affected.
- Its business is exposed to foreign exchange rate related fluctuations.
- The company's registered office and processing facility are located on leave and licensed premises and consequently, the company is required to comply with certain requirements given under leave and license agreements.
- The company faces numerous protective trade restrictions, including anti-dumping laws, countervailing duties and tariffs, which could adversely affect its revenue from exports.
- The company has experienced negative cash flows in relation to its operating, investing and financing activities in the last three financial years. Any negative cash flows in the future would adversely affect its results of operations and financial condition.
- There have been instances in the past where the company has not made certain regulatory filings with the RoC and there were certain instances of discrepancies in relation to certain statutory filings and corporate records of the Company.
- Its production processes depends on the outsourcing of dyeing services, and the company operates without any agreements. Any inability to obtain sufficient quantities of products in a timely manner and at acceptable prices, or a slowdown, shutdown or disruption in such third parties' operations and performance, could adversely affect its business, cash flows, results of operations and financial condition.
- There have been some instances of delays in filing of statutory and regulatory dues in the past with the various government authorities.
- The company is involved in certain legal proceedings, which, if determined adversely, may affect its business and financial condition.
- Its may not purchase Machineries from dealers/ Suppliers mentioned in this Red Herring Prospectus.
- The company has entered into and may continue to enter into related party transactions and there can be no assurance that such transactions have been on favourable terms.
- There is no monitoring agency appointed by the Company and the deployment of funds are at the discretion of its Management and the company Board of Directors, though it shall be monitored by the Audit Committee.
- The Company being in the wholesale sector, requires high working capital for its smooth day to day operations of business and any discontinuance or its inability to acquires adequate working capital timely and on favorable terms may have an adverse effect on its operations, profitability and growth prospects.
- The company has prepared the write-up of the management chapter with very limited documents available.
- Its contingent liabilities as stated in the company Restated Financial Statements could affect its financial condition.
- Its may not be successful in implementing the company's business strategies.
- The Company has unsecured loans with a total outstanding amount of Rs. 4,4411.78 lakhs as of June 30, 2024, that may be recalled by the lenders at any time.
- Its success depends heavily upon the company individual Promoters and Directors for their continuing services, strategic guidance and financial support.
- Its logo "NG" is not registered with the trademark registration authority, and the company may be unable to protect its logo from being infringed by others which may adversely affect the company's business value, financial condition and results of operations.
- Information relating to the installed production capacity and capacity utilization of its production units included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.
- Its Promoters and Promoter Group will be able to exercise significant influence and control over its operations after the issue and may have interests that are different from those of the company's other shareholders.
- Its Promoters, Directors, Key Managerial Personnel and Senior Management Personnel may have interest in the Company, other than reimbursement of expenses incurred, remuneration or other benefits received.
- Its Promoters and Directors have interests in entities, which are in businesses similar to its and this may result in potential conflict of interest with the company.
- The company has certain amount of outstanding indebtedness, which requires significant cash flows to service and are subject to certain
conditions and restrictions in terms of its financing arrangements, which restricts the company ability to conduct the company's business and operations in the manner the company desires.
- Its Promoter has provided personal guarantee for loans availed by the company.
- Its insurance coverage may not adequately protect the company against potential risk, and this may have a material adverse effect on its business.
- The company has not identified any alternate source of financing the 'Objects of the Issue'. If the company fails to mobilize resources as per its plans, its growth plans may be affected.
- The company is subject to various government regulations and if the company fails to obtain, maintain or renew its statutory and regulatory licenses, permits and approvals required to operate its business, the company's business, results of operations and cash flows may be adversely affected.
- The requirements of being a listed company may strain its resources.
- If the company is subject to any frauds, theft, or embezzlement by its employees, suppliers or customers, it could adversely affect the company
reputation, results of operations, financial condition and cash flows.
- The Company's processing activities are labour intensive and depends on availability of skilled and unskilled employee in large numbers.
- The company does not have any offshore offices to manage its international operations.
- The company ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures.
- The Equity Shares have never been publicly traded, and, after the issue, the equity shares may experience price and volume fluctuations, and an active trading market for the equity shares may not develop. Further, the price of the equity shares may be volatile, and you may be unable to resell the equity shares at or above the issue price, or at all.
- There are restrictions on daily weekly monthly movement in the price of the equity shares, which may adversely affect the shareholder's ability to sell for the price at which it can sell, equity shares at a particular point in time.
- Industry information included in this Red Herring Prospectus has been derived from publicly available industry reports and/or websites. There can be no assurance that such third-party statistical financial and other industry information is either complete or accurate.
- QIB and Non-Institutional Investors are not permitted to withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after submitting a Bid.
- Investors will not be able to sell immediately on an Indian stock exchange any of the Equity Shares they purchase in the Issue.
- Any future issuance of Equity Shares may dilute the shareholding of the Investor, or any sale of Equity Shares by its Promoters or other significant shareholder(s) may adversely affect the trading price of the Equity Shares.
Neelam Linens and Garments (India) Ltd Peer Comparison
Understand the company’s industry standing
Neelam Linens and Garments (India) Ltd
Loyal Textile Mills Ltd
Bannari Amman Spinning Mills Ltd
Face Value
10
10
5
Standalone / Consolidated
Standalone
Standalone
Standalone
Total Income Rs. Cr.
102.3391
939.1871
923.5188
EPS-Basis
1.66
-89.17
-3.18
EPS-Diluted
1.66
-89.17
-3.18
NAV Per Share
15.87
603.31
58.55
P/E-Basic EPS
---
---
---
P/E-Diluted EPS
---
---
---
RONW(%)
10.48
-14.78
-6.91
Latest NAV Period
---
---
---
Latest NAV
---
---
---
How to check the allotment status of Neelam Linens and Garments (India) Ltd IPO?
Follow the steps
Open link to the registrar using this URL (https://evault.kfintech.com/ipostatus/).
Select company from dropdown menu.
Enter details- PAN, Application number or DP client ID
Get your allotment status
Open link to the registrar using this URL (https://evault.kfintech.com/ipostatus/).
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The IPO opens on 08 Nov 2024 & closes on 12 Nov 2024.
Neelam Linens and Garments (India) Limited was incorporated as Private Limited Company under the name 'Neelam Linens and Garments (India) Private Limited', and Certificate of Incorporation was issued by the Registrar of Companies, Mumbai on September 22, 2010. The status of the Company was changed to PublicLlimited and the name of Company was changed to 'Neelam Linens and Garments (India) Limited' vide dated August 12, 2022. The fresh Certificate of Incorporation consequent to conversion was issued on September 01, 2022 by the Registrar of Companies, Mumbai.
The Company operate as a soft home furnishing company based out of Maharashtra, India, extending our services to a global clientele, USA and Australia and Far East. It specialize in the processing, finishing and supplying of bedsheets, Pillow cover, Duvet Cover, Towels, Rugs, Doher, Shirts & Garments predominantly for discounted retail outlets. It source surplus or slightly imperfect fabric from the domestic market, applying value-added services such as dyeing, stitching, embroidery, and other enhancements. Subsequently, it distribute these refined products to discounted retail outlets in diverse countries.
The Company operate two manufacturing operations at Bhiwandi, Thane. Unit I is engaged in cutting fabric and stitching whereas Unit 2 has checking department and packing department. The Company has products following, Bed Sheets, Towels, Pillow covers, Rugs, Hand towels / napkins, Doher, Shirts and T-shirts. The process of Bedsheet, Pillow covers, Shirts and T-shirts are processed at our units and other products are just procured readily and sold after the process of thread cutting, final quality check and packaging by the Company.
The Company has entered the apparel industry by starting an in-house production of men's and women's fashion apparel since 2023.
The Company is proposing the Public Issue of 60,00,000 Fresh Issue Equity Shares.
Neelam Linens and Garments (India) Ltd IPO will close on 12 Nov 2024.
- Purchase of higher quality thread count fabric at lower price.
- Experienced promoters and dedicated employee base.
- Infrastructure and Integrated capabilities to deliver quality Products.
| S.No | Promoters Name | Pre Issue Shares | Pre Issue Percentage | Post Issue Shares | Post Issue Percentage |
|---|---|---|---|---|---|
| 1 | Kantilal Jethva | 1240000 | 8.38 | 1240000 | 6.13 |
| 2 | Bhavin Jethwa | 8188000 | 55.32 | 8188000 | 40.5 |
| 3 | Manjula Jethva | 775000 | 5.24 | 775000 | 3.83 |
| 4 | Janki Jethva | 775000 | 5.24 | 775000 | 3.83 |
- Its business predominantly focuses on bedsheets, which makes the company particularly susceptible to fluctuations in demand. Any shifts in consumer preferences have the potential to significantly impact its business, as well as influence its operational outcomes and financial standing.
- A majority of its supplies for the company operations are obtained from a limited number of suppliers.
- The company is dependent on a few customers for a major part of its revenues. Further the company does not enter into long-term arrangements with its customers could adversely affect its business and results of operations.
- The majority of the business of sale of licenses of our company occurs from the trading activity.
- The Company and the promoters does not have enough documentary evidence for the Capital Built-up of the Company.
- A significant portion of its sales are derived from India and any adverse developments in this market could adversely affect its business.
- The company has only one production unit that is located in Bhiwandi and any localized social unrest, natural disaster or breakdown of services or any other natural disaster in and around Ahmednagar or any disruption in production at, or shutdown of, its production unit could have material adverse effect on the company's business and financial condition.
- Its success depends on third party logistics and transportation infrastructure. Disruption of logistics and transportation services could impair the ability of its suppliers to deliver raw materials or the company's ability to deliver products to its customers and/ or increase the company transportation costs, which may adversely affect its operations.
- If the company is unable to maintain an optimal level of inventory, its business, results of operations and financial condition may be adversely affected.
- Its business is exposed to foreign exchange rate related fluctuations.
- The company's registered office and processing facility are located on leave and licensed premises and consequently, the company is required to comply with certain requirements given under leave and license agreements.
- The company faces numerous protective trade restrictions, including anti-dumping laws, countervailing duties and tariffs, which could adversely affect its revenue from exports.
- The company has experienced negative cash flows in relation to its operating, investing and financing activities in the last three financial years. Any negative cash flows in the future would adversely affect its results of operations and financial condition.
- There have been instances in the past where the company has not made certain regulatory filings with the RoC and there were certain instances of discrepancies in relation to certain statutory filings and corporate records of the Company.
- Its production processes depends on the outsourcing of dyeing services, and the company operates without any agreements. Any inability to obtain sufficient quantities of products in a timely manner and at acceptable prices, or a slowdown, shutdown or disruption in such third parties' operations and performance, could adversely affect its business, cash flows, results of operations and financial condition.
- There have been some instances of delays in filing of statutory and regulatory dues in the past with the various government authorities.
- The company is involved in certain legal proceedings, which, if determined adversely, may affect its business and financial condition.
- Its may not purchase Machineries from dealers/ Suppliers mentioned in this Red Herring Prospectus.
- The company has entered into and may continue to enter into related party transactions and there can be no assurance that such transactions have been on favourable terms.
- There is no monitoring agency appointed by the Company and the deployment of funds are at the discretion of its Management and the company Board of Directors, though it shall be monitored by the Audit Committee.
- The Company being in the wholesale sector, requires high working capital for its smooth day to day operations of business and any discontinuance or its inability to acquires adequate working capital timely and on favorable terms may have an adverse effect on its operations, profitability and growth prospects.
- The company has prepared the write-up of the management chapter with very limited documents available.
- Its contingent liabilities as stated in the company Restated Financial Statements could affect its financial condition.
- Its may not be successful in implementing the company's business strategies.
- The Company has unsecured loans with a total outstanding amount of Rs. 4,4411.78 lakhs as of June 30, 2024, that may be recalled by the lenders at any time.
- Its success depends heavily upon the company individual Promoters and Directors for their continuing services, strategic guidance and financial support.
- Its logo "NG" is not registered with the trademark registration authority, and the company may be unable to protect its logo from being infringed by others which may adversely affect the company's business value, financial condition and results of operations.
- Information relating to the installed production capacity and capacity utilization of its production units included in this Red Herring Prospectus are based on various assumptions and estimates and future production and capacity may vary.
- Its Promoters and Promoter Group will be able to exercise significant influence and control over its operations after the issue and may have interests that are different from those of the company's other shareholders.
- Its Promoters, Directors, Key Managerial Personnel and Senior Management Personnel may have interest in the Company, other than reimbursement of expenses incurred, remuneration or other benefits received.
- Its Promoters and Directors have interests in entities, which are in businesses similar to its and this may result in potential conflict of interest with the company.
- The company has certain amount of outstanding indebtedness, which requires significant cash flows to service and are subject to certain conditions and restrictions in terms of its financing arrangements, which restricts the company ability to conduct the company's business and operations in the manner the company desires.
- Its Promoter has provided personal guarantee for loans availed by the company.
- Its insurance coverage may not adequately protect the company against potential risk, and this may have a material adverse effect on its business.
- The company has not identified any alternate source of financing the 'Objects of the Issue'. If the company fails to mobilize resources as per its plans, its growth plans may be affected.
- The company is subject to various government regulations and if the company fails to obtain, maintain or renew its statutory and regulatory licenses, permits and approvals required to operate its business, the company's business, results of operations and cash flows may be adversely affected.
- The requirements of being a listed company may strain its resources.
- If the company is subject to any frauds, theft, or embezzlement by its employees, suppliers or customers, it could adversely affect the company reputation, results of operations, financial condition and cash flows.
- The Company's processing activities are labour intensive and depends on availability of skilled and unskilled employee in large numbers.
- The company does not have any offshore offices to manage its international operations.
- The company ability to pay dividends in the future will depends upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures.
- The Equity Shares have never been publicly traded, and, after the issue, the equity shares may experience price and volume fluctuations, and an active trading market for the equity shares may not develop. Further, the price of the equity shares may be volatile, and you may be unable to resell the equity shares at or above the issue price, or at all.
- There are restrictions on daily weekly monthly movement in the price of the equity shares, which may adversely affect the shareholder's ability to sell for the price at which it can sell, equity shares at a particular point in time.
- Industry information included in this Red Herring Prospectus has been derived from publicly available industry reports and/or websites. There can be no assurance that such third-party statistical financial and other industry information is either complete or accurate.
- QIB and Non-Institutional Investors are not permitted to withdraw or lower their Bids (in terms of quantity of Equity Shares or the Bid Amount) at any stage after submitting a Bid.
- Investors will not be able to sell immediately on an Indian stock exchange any of the Equity Shares they purchase in the Issue.
- Any future issuance of Equity Shares may dilute the shareholding of the Investor, or any sale of Equity Shares by its Promoters or other significant shareholder(s) may adversely affect the trading price of the Equity Shares.
The Issue type of Neelam Linens and Garments (India) Ltd is Book Building - SME.
The minimum application for shares of Neelam Linens and Garments (India) Ltd is 6000.
The total shares issue of Neelam Linens and Garments (India) Ltd is 5418000.
Initial public issue of up to 54,18,000^ equity shares of face value of
Rs. 10 each ("Equity Shares") of Neelam Linens and Garments (India) Limited ("Company") for cash at a price of Rs. 24 per equity share (including a share premium of Rs. 14 per equity share) ("Issue Price") aggregating up to Rs. 13.00 crores of which up to 2,76,000 equity shares of face value of
Rs. 10 each for cash at a price of Rs. 24 per equity share including a share premium of Rs. 14 per equity share aggregating to Rs. 0.66 crores will be reserved for subscription by market maker to the issue (the "Market Maker Reservation Portion"). The issue less the market maker reservation portion i.e. net issue of 51,42,000 equity shares of face value of Rs. 10 each at a price of Rs. 24 per equity share aggregating to Rs. 12.34 crores is herein after referred to as the "Net Issue". The issue and the net issue will constitute 26.80% and 25.43% respectively of the post issue paid up equity share capital of the company.