Nandan Terry Ltd IPO 

Last Updated on October 26, 2023 by BFSLTeam BFSLTeam

The Ahmedabad-based manufacturer Nandan Terry plans to raise funds worth Rs. 255 crore and use the proceeds towards repayment of debt, working capital funding, and other corporate needs. However, the company withdrew its draft papers on June 7 2022 and the reasons for the same were not disclosed. It may refile its DRHP and decide to launch the Nandan Terry Ltd IPO this year.

Established in 2015, Nandan Terry, headquartered in Ahmedabad, is a fully integrated company specialising in the manufacture of terry towels and towel products. Apart from its core business, the company sells cotton yarn produced in its units to increase its sales revenue.

Now, let’s learn about the company and its operations, revenue, and financials. 

About Company 

Part of the Ahmedabad-based Chiripal Group, Nandan Terry Pvt Ltd operates in various sectors including textiles, education, real estate, packaging and chemicals. It has been operational since 2015 and holds expertise in production of terry towels as well as other towelling products.

Nandan Terry sources cotton bales from international and domestic markets and manufactures cotton yarns used to produce towels. To meet market demand, woven fabrics and readymade towels are sourced externally and further processed internally.

In addition to its manufacturing segment, the company occasionally sells cotton yarns and fabrics on the open market. All manufacturing units are situated in Gujarat, and serve various B2B requirements globally. These facilities have advanced machinery for spinning and processing with a total capacity of producing 25 million towels annually.

The company designs and manufactures a wide range of towels for domestic and global brands. It has its own design and research facilities that adhere to strict quality control standards, enabling it to expand sales internationally, reaching countries such as  the UK, the US, Israel, Canada, Hong Kong, Sweden, Germany, and Australia. 

The company holds certifications from renowned global agencies such as SEDEX, OEKO-TEX, SA 8000, and GOT. This reflects its commitment to quality, environmental awareness, work practices and customer support.

Company Financials 

Find some crucial financial details of Nandan Terry in the table below: 

Parameters as Per the Year Ending On	March 31 2021	March 31 2020	March 31 2019
Total Assets	67,969.81	65,528.84	65,783.90
Total Liabilities	56,275.18	56,238.81‬	56,410.49
Total Expenses	50,748.86	42,574.05	32,280.98
Total Revenue	53,894.12	42,969.48	32,242.75
Profit/Loss After Tax	2,337.74	122.40	(50.41)
EBITDA	8,724.22	6,215.24	5,080.95
Earnings Per Share (EPS) (Basic & Diluted) *	5.11	0.27	(0.11)

*All values are in Rs. lakhs except EPS 

Also Read: IPO investment strategy

Strengths of Nandan Terry Ltd

Here are some unique facts and figures showing the strengths of Nandan Terry Ltd: 

• The founders, who serve on the board of directors, have been with the company since its foundation. They have extensive knowledge of the domestic and global textile industry and more than 20 years of proven expertise. 
• The company uses cutting-edge technology and machinery from leading suppliers in India and abroad.
• Its plant contains 102 looms, including 24 Jacquard and 78 Dobby looms, along with advanced machinery in the towel finishing section. These modern machines not only maintain high-quality standards but also enable innovative design and trend-setting through radical colour and print combinations.
• The company’s plant at Dholi Spinning Park in Ahmedabad, Gujarat and processing units at Piple are in strategic locations with excellent rail, road and air connectivity, including access to Mundra and Nhava Sheva ports.
• The Dholi plant is specifically well connected to the Ahmedabad International Airport and National Highways 751 and 47.
• There are abundant skilled and semi-skilled labourers in the regions where the manufacturing units are situated. This strengthens the company’s convenience in purchasing raw materials and transporting products.
• The company benefits from the various incentives mentioned in the “Textile Policy of Gujarat-2012” offered by the Government of Gujarat. This policy aims to strengthen the entire value chain of the state’s textile sector by providing subsidies such as power tariffs, interest and VAT rebates.

Risks Involved in Nandan Terry Ltd

There are also some risks that pose a significant threat to the company’s growth, operations, and cash flow. Some notable ones are discussed below: 

• In order to operate its business, Nandan Terry Ltd must obtain, renew and maintain specific legal permits and approvals as required by applicable laws and regulations. Failure to do so could adversely affect its business, financial stability, results of operations and cash flow. 
• Its business operations require a consistent and affordable supply of electricity and water. Unfortunately, its facilities lack sufficient backup power to deal with emergencies caused by power outages. Inadequate availability of electricity and water may limit its operational capacity, which would hurt revenue generation.

Also Read: Risk of investing in IPO

Summary 

Nandan Terry Ltd IPO was supposed to be entirely a fresh issue of equity shares. The company filed its DRHP in December 2021 and withdrew it in June 2022, for reasons that are not yet disclosed. However, if the company decides to launch its IPO again, the above information will be helpful to potential investors. 

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