With its US $ 64.84 million initial public offering (IPO) scheduled to open for public subscription on 19th December, yarn products maker Sanathan Textiles has submitted a red herring prospectus (RHP) to the Registrar of Companies. Compared to the US $ 94.31 million stated in the preliminary papers, the total offer size has been lowered.
The company submitted draft documents for the third time in August 2024, and on November 6th, the capital markets regulator SEBI approved them. The RHP filed on 14th December states that the IPO consists of an offer-for-sale of shares by the promoters (Dattani family) for US $ 17.68 million and a new issue of equity shares for US $ 47.15 million.
Sanathan engages in three yarn business verticals: polyester yarn products, cotton yarn products, and yarns for technical textiles and industrial applications. The company has an installed capacity of 2,23,750 MTPA at its Silvassa site. Cotton yarn made up about 19 per cent of income, while polyester yarn made up the largest percentage at 77 per cent.
On 18th December, the IPO’s anchor book will open to institutional investors, and on 23d December, the public subscription period for the initial public offering will end.
The Mumbai-based business would use the US $ 35.36 million net proceeds from the new issue to pay down its own debt as well as that of its subsidiary Sanathan Polycot. The promoters will receive the offer-for-sale money, and the remaining amount will be used for general business reasons.
