NR Vandana Tex Industries Ltd. IPO: Key Details

N R Vandana Tex Industries

• N R Vandana Tex Industries is coming out with an initial public offering (IPO) of 61,98,000 equity shares in a price band Rs 42-45 per equity share.
• The issue will open on May 28, 2025 and will close on May 30, 2025.
• The shares will be listed on SME Platform of NSE.
• The face value of the share is Rs 10 and is priced 4.20 times of its face value on the lower side and 4.50 times on the higher side.
• Book running lead manager to the issue is Marwadi Chandarana Intermediaries Brokers.
• Compliance Officer for the issue is Sweta Agarwal.

Profile of the company

N R Vandana Tex Industries engaged into designing, manufacturing and wholesale business of cotton textile products including a variety of high-quality cotton sarees, salwar suits and bed sheets. The company’s products are recognised in textile industry under its own brand name “Vandana” and “Tanaya”. The company have been awarded “Best Debutant - Apparels” by Ajio Business Partnership Meet - 2022. The company operates into B2B business model, focusing on selling its products through a network of 1397 wholesalers as of March 31, 2025 spread across 31 states and union territories in India and through a channel of B2B e-commerce platform.

The company’s manufacturing process includes cutting, dyeing, embroidery, sewing, embellishments, finishing, inspection and packing. It also outsources certain manufacturing on job work from time to time and provides the technical specifications such as designs, pattern, quality, fabric etc. to them who, based on its specifications begin the manufacturing process. As on March 31, 2025 it had engaged 229 job workers for its manufacturing process. As on March 31, 2025, it has presence in 31 states and union territories and has generated revenue 2.46% from the south region, 2.10 % from the north region, 88.10% from the east region and 7.34% from the west region. Further, it actively engages with potential clients through direct visits and leverages strong local market connections to expand its reach.

The company offers its diverse range of products to various segments of the market that include printed sarees and embroidery sarees, unstitched salwar suits (salwar suits) and bedsheets across different price points thereby catering to customers across all market segments. It purchases raw materials like grey fabric, ready-to-use bleached or dyed fabric, and printed fabrics which undergoes bleaching or dyeing before being processed into sarees, salwar suits, and bedsheets at its Manufacturing units or external job units. As on March 31, 2025, it has catered over 1397 network of wholesalers and its product catalogue features a diverse range of more than 1500 distinct SKUs.

Proceed is being used for:

• Funding working capital requirements of the company
• Prepayment / repayment of loan
• General corporate purposes

Industry Overview

India’s textiles sector is one of the oldest industries in the Indian economy, dating back to several centuries. The industry is extremely varied, with hand-spun and hand-woven textiles sectors at one end of the spectrum, with the capital-intensive sophisticated mills sector at the other end. The fundamental strength of the textile industry in India is its strong production base of a wide range of fibre/yarns from natural fibres like cotton, jute, silk, and wool, to synthetic/man-made fibres like polyester, viscose, nylon and acrylic. The decentralised power looms/ hosiery and knitting sector form the largest component of the textiles sector. The close linkage of textiles industry to agriculture (for raw materials such as cotton) and the ancient culture and traditions of the country in terms of textiles makes it unique in comparison to other industries in the country.

The market for Indian textiles and apparel is projected to grow at a 10% CAGR to reach $350 billion by 2030. Moreover, India is the world’s third largest exporter of Textiles and Apparel. India ranks among the top five global exporters in several textile categories, with exports expected to reach $100 billion. The textiles and apparel industry contributes 2.3% to the country’s GDP, 13% to industrial production and 12% to exports. The textile industry in India is predicted to double its contribution to the GDP, rising from 2.3% to approximately 5% by the end of this decade. The Indian Medical Textiles market for drapes and gowns is around $9.71 million in 2022 and is expected to grow at 15% to reach $22.45 million by 2027. The Indian composites market is expected to reach an estimated value of $1.9 billion by 2026 with a CAGR of 16.3% from 2021 to 2026 and the Indian consumption of composite materials will touch 7,68,200 tonnes in 2027.

The future of the Indian textiles industry looks promising, buoyed by strong domestic consumption as well as export demand. India is working on various major initiatives to boost its technical textile industry. Owing to the pandemic, the demand for technical textiles in the form of PPE suits and equipment is on the rise. The government is supporting the sector through funding and machinery sponsoring. Top players in the sector are achieving sustainability in their products by manufacturing textiles that use natural recyclable materials. The technical textiles market for automotive textiles is projected to increase to $3.7 billion by 2027, from $2.4 billion in 2020. Similarly, the industrial textiles market is likely to increase at an 8% CAGR from $2 billion in 2020 to $3.3 billion in 2027. The overall Indian textiles market is expected to be worth more than $209 billion by 2029. 

Pros and strengths

Wide geographic presence: The company generally sells its product through a network of wholesalers located at different locations of the country. As on April 30, 2025, its dedicated Sales and Marketing team comprises of 23 members, actively engage with potential clients, building strong relationships through personal interactions and a deep understanding of their needs. By leveraging its local market connections, it taps into a vast network of wholesalers, which helps it to expand its market presence. Additionally, the company places great value on word-of-mouth referrals, frequently receiving recommendations from its satisfied customers. Its sales strategy ensures that it maintains a strong market presence, continuously identifying new opportunities while reinforcing its relationships with existing customers.

Strong distribution network: As on March 31, 2025, the company has established a distribution network that spans pan India. Its supply chain and logistics systems are designed to support efficient and timely distribution, meeting the needs of its customer base. The company had a network of 1397, 893 and 886 wholesalers in the Fiscal 2025, Fiscal 2024 and Fiscal 2023. Its widespread distribution network provides it wide geographical presence in terms of coverage of different states of the country. The company’s distribution network leverages its marketing and reduces its concentration customer wise and state wise.

Vast product portfolio: The company’s product portfolio is vast and versatile in women’s apparel segment includes sarees and salwar suits and in home furnishing product segment includes bed sheets. Currently, its product catalogue lists more than 1500 different SKUs. The sarees products offered at stores of its network of wholesalers are further bifurcated by occasion, fabric, weave, pattern and ornamentations and more than 98.00% percent of business revenue of the company is generated from sale of sarees. It focuses on trending fashion designs with an emphasis on quality to offer new and varied products to its customers throughout the year.

Risks and concerns  

Generate a substantial portion of revenue from West Bengal: The company has presence across 31 States and Union territory among which, its revenue is concentrated in the one State i.e.; West Bengal. It generated almost 77.18%, 77.57% and 75.61% of the Total Revenue generated for the financial year ended March 31, 2025, 2024 and 2023 respectively. Such geographical concentration of its business in the West Bengal region heightens its exposure to adverse developments related to competition, as well as economic and demographic changes in the region, which may adversely affect its business prospects, financial conditions and results of operations.

Dependent upon few suppliers for the material requirements of the business: While the company has maintained a long-term relationship with many of its suppliers and it has been able to negotiate favorable credit terms from them due to increased order sizes and timely payments, it cannot assure that it shall be able to maintain such favourable credit terms in future. In this regard, for the year ended March 31, 2025, March 31, 2024 and March 31, 2023 its top 10 suppliers contributed around 46.98%, 49.29% and 46.31% respectively of its purchases. The company is, to a major extent, dependent on external suppliers for its grey fabric, ready-to-use bleached or dyed fabric, and printed fabrics, etc.; it does not have any long-term supply agreements or commitments in relation to the same used in its manufacturing process.

Rely on certain marketplaces and web traffic drivers for sales through its online channel: As part of its online sales channels, the company sells its products through its direct-to-business channel such as AJIO, Solv, Udaan, Bijnis. For the Fiscal 2025, Fiscal 2024 and Fiscal 2023, its revenue from online channels amounted to Rs 5642.12 lakh, Rs 6,499.28 lakh and Rs 3,905.08 lakh representing 20.83%, 25.80% and 29.53% of its revenue from operations, respectively. Online marketplaces could also change their business practices or seek to modify their contractual terms, such as payment terms. For the Fiscal 2025, Fiscal 2024 and Fiscal 2023 its expense as support sale charges to online channels amounted to Rs 504.91 lakh, Rs 638.08 lakh, Rs 154.34 lakh representing 1.94%, 2.97%, 0.80% of its total expense. Further, such entities may also increase the cost of their services, due to inflationary pressures or other reasons, which may adversely impact its expenses and profitability.

Outlook

N R Vandana Tex Industries is a Kolkata-based company specializing in the design, manufacturing, and wholesale distribution of cotton textile products, including sarees, salwar suits, and bed sheets. The company markets its products under the brand names Vandana and Tanya. Operating on a B2B model, the company distributes its products through a network of 1,041 wholesalers across 31 Indian states and leverages a B2B e-commerce platform for broader reach. Also, the company has robust Pan-India distribution network. On the concern side, the company’s business is highly concentrated on the sale of women’s sarees and is vulnerable to variations in demand and changes in consumer preference, could have an adverse effect on its business, results of operations and financial condition. The company is dependent upon few suppliers for the material requirements of its business. Further, it does not have definitive agreements or fixed terms of trade with most of its suppliers. Failure to successfully leverage its relationships with existing suppliers or to identify new suppliers could adversely affect its business operations.

The company is coming out with a maiden IPO of 61,98,000 equity shares of Rs 10 each. The issue has been offered in a price band of Rs 42-45 per equity share. The aggregate size of the offer is around Rs 26.03 crore to Rs 27.89 crore based on lower and upper price band respectively. On performance front, the company’s income from revenue from operations was increased by 23.03% to Rs 27,080.25 lakh for the FY 2025 from Rs 22,010.8 lakh for the FY 2024. This was on account of expansion in its customer base and a ramp-up in orders from existing long-term client. Moreover, the company’s Profit after Tax increased by 100.16% to Rs 859.50 lakh in FY 2025 from Rs 429.40 lakh in FY 2024.

Further, the company will continue to increase brand awareness and customer loyalty through its marketing efforts and planned retail expansion. It seeks to seize market opportunities by continuing to allocate significant resources to enhance its brand ‘Vandana’. The company’s marketing plan includes advertising in print media, electronic advertising, television campaigns, social media, etc. The scale of its business provides it the ability to increasingly focus on branding and promotion to further increase its visibility and market share across India.