Shares of Sanathan Textiles will make a market debut today. The company has fixed the IPO price as ₹321 after the issue subscribed 32.12 times overall.

“We expect the company can list with decent listing gain around 25 per cent and more on its issue price. We recommend conservative allotted investors can think of booking profits over and above our expectations,” said Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd. 

The ₹550-crore initial public offering from the yarn manufacturer received bids for 44.32 crore shares, against 1.26 crore shares on offer. The IPO – combination of a fresh issue (₹400 crore) and an offer-for-sale (₹150 crore by the promoters and promoter group entities) – received strong response from QIBs (75.62 times), NIIs 42.21 times and retail investors 8.93 times.

As part of the IPO exercise, Sanathan Textiles had raised ₹165 crore from anchor investors by allotting 51.4 lakh shares to 20 funds at ₹321 apiece. Among them were SBI Mutual Fund, Nippon India MF, HDFC Mutual, Kotak MF, Bandhan MF, SBI General Insurance Company, Societe Generale and PineBridge Global Funds.

The Maharashtra-based company plans to utilise the proceeds from its fresh issue worth ₹160 crore for payment of debt, ₹140 crore will be invested in its subsidiary, Sanathan Polycot Pvt Ltd, for the repayment or prepayment of its borrowings, and the remaining amount will be allocated for general corporate purposes.

Sanathan Textiles is engaged in manufacturing textile yarn, which is divided into three separate business verticals consisting of polyester yarn products; cotton yarn products; and yarn for technical textiles and industrial uses, finding application in multiple end-use segments, including automotive, healthcare, construction, sports and outdoor, and protective clothing. Currently, all the three yarn verticals are housed under a single corporate entity.