Shree Ram Twistex IPO Review: Financials, Risks & Issue Details

Shree Ram Twistex IPO: Issue Details, Financials, and Risk Factors

Shree Ram Twistex Limited is gearing up to raise funds through its initial public offering (IPO), which opens for subscription on Monday, February 23, 2026. The company, which specializes in the manufacturing of cotton yarns, will be offering a fresh issue of up to 1,06,00,000 equity shares.

As the bidding period approaches, here is a comprehensive review of the company's business model, financial performance, and key risk factors that investors should consider.

Issue Details and Timelines

The upcoming public offer is a 100% book-built issue. Below are the key details of the IPO:

• Issue Open Date: Monday, February 23, 2026
• Issue Close Date: Wednesday, February 25, 2026
• Issue Type: Fresh Issue of up to 1,06,00,000 Equity Shares
• Face Value: ₹10 per Equity Share
• Listing: The shares are proposed to be listed on both the BSE and NSE.
• Lead Manager: Interactive Financial Services Limited
• Registrar: Bigshare Services Private Limited

The net proceeds from the fresh issue will primarily be utilized for setting up renewable energy plants (a 6.1 MW solar power plant and a 4.2 MW wind power plant), repaying or prepaying certain borrowings, funding working capital requirements, and general corporate purposes.

Business Overview

Incorporated in 2013, Shree Ram Twistex Limited operates a fully integrated spinning manufacturing facility in Gondal, Rajkot, Gujarat. The company is engaged in the manufacturing of various types of cotton yarns, including compact ring-spun, combed, and carded yarns. It also produces value-added products like Eli Twist, compact slub yarns, and Lycra-blended yarns.

Operating exclusively in the business-to-business (B2B) segment, the company supplies its products to institutional buyers, textile manufacturers, and garment exporters. The yarns are widely used across multiple end-use segments such as denim, terry towels, shirting, bottom wear, and home textiles.

Financial Performance

Shree Ram Twistex has demonstrated a consistent growth trajectory in its revenues and profitability over the last few fiscal years.

• Revenue from Operations: The company reported revenue from operations of ₹21,310.25 lakhs in Fiscal 2023, which increased to ₹23,159.12 lakhs in Fiscal 2024, and further to ₹25,504.47 lakhs in Fiscal 2025. For the six-month period ended September 30, 2025, the company posted a revenue of ₹13,208.48 lakhs.
• Profit After Tax (PAT): The bottom line has also seen significant improvement. The PAT stood at ₹205.08 lakhs in Fiscal 2023, ₹655.25 lakhs in Fiscal 2024, and ₹799.59 lakhs in Fiscal 2025. For the first half of Fiscal 2026 (ended September 30, 2025), the net profit was ₹700.02 lakhs.
• Earnings Per Share (EPS): The basic EPS improved from ₹0.70 in Fiscal 2023 to ₹2.72 in Fiscal 2025.
• Net Worth: As of September 30, 2025, the company's net worth stood at a robust ₹8,070.11 lakhs.

While the financial growth is evident, the company did report negative cash flows from operating activities amounting to ₹491.15 lakhs in Fiscal 2024, primarily due to an increase in working capital requirements. However, operating cash flows turned positive again in Fiscal 2025, generating ₹2,175.51 lakhs.

Key Risk Factors

Investors evaluating the Shree Ram Twistex IPO must weigh the following risks outlined in the Red Herring Prospectus (RHP):

• High Customer Concentration: A major portion of the company's revenue depends on a limited number of customers. In Fiscal 2025, its top customer accounted for 32.97% of the total revenue, and in Fiscal 2024, it was as high as 44.35%. The loss of key clients could materially impact business operations.
• Geographic Dependency: The company's manufacturing facility and registered office are both located in Gujarat. Moreover, a substantial portion of its revenue is derived from the state (accounting for 87.72% of revenue in the six months ended September 30, 2025). This geographic concentration exposes the company to regional disruptions or local regulatory changes.
• Raw Material Volatility: The primary raw material, cotton bales, accounts for a major portion of production costs (constituting around 66.23% of the revenue from operations in Fiscal 2025). The business is highly vulnerable to fluctuations in cotton prices, which are influenced by climatic conditions, government support prices, and global market dynamics.
• Supplier Reliance: The company depends on a limited number of suppliers for its cotton bales. Any disruption in the supply chain or an inability to procure raw materials at competitive rates can hinder production schedules.
• Capital Intensive Nature: The business requires significant working capital. Failure to secure adequate funding or manage inventory efficiently could strain liquidity and financial health.

Market Context and Considerations

Shree Ram Twistex Limited presents an opportunity to track a growing, B2B-focused textile player with an expanding product portfolio. The company's strategic shift toward renewable energy integration for captive consumption highlights a proactive approach to cost optimization. The consistent revenue and profit growth indicate a stable operational foundation.

However, the heavy reliance on a few key customers, geographical concentration in Gujarat, and the inherent volatility of raw cotton prices are critical risk factors. Market participants should closely monitor the final price band announcement and the upcoming subscription figures to gauge institutional and retail interest before making an investment decision.

Disclaimer: This article is for informational and educational purposes only and does not constitute financial or investment advice. Investors are advised to read the Red Herring Prospectus (RHP) and consult with a SEBI-registered financial advisor before investing.