Neelam Linens and Garments (India) Ltd IPO

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Neelam Linens and Garments operates from its registered office in Mumbai, strategically positioned at 446-447, 4th Floor, Shah & Nahar Industrial Estate, Lower Parel, Delisle Road. The company’s primary processing facility is located in Thane, Maharashtra, specifically at Gala Nos. 103-107 (First Floor) and 201-208 (Second Floor) in Prithvi Complex, Old Agra Road, Bhiwandi, ensuring streamlined operations in production and processing.

Core Business Segments

Neelam Linens and Garments has diversified its business operations into two primary segments:
i. Processing and Trading of Products: The company engages extensively in the sourcing, processing, and trading of soft home furnishings. It deals with an array of products such as bedsheets, pillow covers, duvet covers, towels, rugs, dohars, and garments including shirts. By sourcing surplus or slightly imperfect fabrics from domestic suppliers, the company adds value through comprehensive services like designing, digital printing, dyeing, stitching, and embroidery. These refined products are then sold to discounted retail outlets in various international markets, including the USA, Australia, and the Far East.

ii. Sale of Import Licenses: Neelam Linens and Garments also generates revenue from the sale of import licenses. These licenses are government-issued authorizations that allow the importation of goods subject to specific regulations. Primarily provided as financial incentives to exporters, import licenses are tradable commodities once issued. The company capitalizes on the value of these licenses by selling or transferring them to other entities, thus contributing to its service-based revenue stream.

Product Expansion and Global Reach

While originally specializing in home furnishings, Neelam Linens and Garments expanded into the apparel sector in 2023, launching an in-house line of men’s and women’s fashion apparel. This strategic move has strengthened its product portfolio and allowed it to cater to the evolving demands of the fashion industry.

The company’s comprehensive approach, from sourcing and value addition to distribution, has positioned it as a versatile player in the global soft home furnishings and apparel markets, offering quality products at competitive prices to retail outlets worldwide.

Objects of the Neelam Linens and Garments (India) Ltd IPO:

The company intends to utilize the proceeds of the issue to meet the following objects: i. Funding capital expenditure requirement of our Company towards the purchase of Embroidery Machines for expansion; ii. Prepayment or repayment of all or a portion of certain outstanding borrowings availed by the Company; iii. General corporate purposes;
DRHP of Neelam Linens and Garments (India) Ltd IPO
RHP of Neelam Linens and Garments (India) Ltd IPO

Neelam Linens and Garments (India) Ltd IPO Details:

Open Date: Nov 08 2024
Close Date: Nov 12 2024
Total Shares: 5,418,000
Face Value: ₹ 10 Per Equity Share
Issue Size: 13.00 Cr.
Lot Size: 6000 Shares
Issue Price: ₹ 20 - 24 Per Equity Share
Listing At: NSE Emerge
Listing Date: Nov 18 2024

Promoters And Management:

Kantilal Jethva, 73, is the Promoter, Whole-time Director, and Chairman of the Company, appointed as Executive Director in 2010 and promoted in October 2022 for five years. A Gujarat University graduate, he has overseen finance and purchasing for 14 years. With 20 years of experience as a manufacturing consultant at Trend Setter Textile Company, he now leads strategic business expansion, overseeing finance, purchases, major project operations, fund management, client and stakeholder relationships, and driving revenue growth initiatives. Bhavin Jethwa, 42, is the Promoter and Managing Director of the Company, holding a Bachelor of Commerce from the University of Mumbai. Associated with the Company since its start, he became Managing Director on October 1, 2022. With over 20 years of experience in business and sales strategies, he began his career as a stitching job operator, supporting supply chains for major international retailers in the garments industry. Falguni Shah, 40, is the Non-Executive Independent Director of the Company, joining on November 27, 2023. She completed her higher secondary education in 2000 and previously worked as a school teacher at Cuddles Playschool and Nursery.

Financials of Neelam Linens and Garments (India) Ltd IPO:

Particulars For 3 months ended June 30, 2024 FY 2023-24 FY 2022-23 FY 2021-22
Revenue 21.79 Cr. 102.33 Cr. 103.56 Cr. 101.52 Cr.
EBITDA 2.83 Cr. 7.81 Cr. 6.52 Cr. 5.93 Cr.
EBITDA Margin 12.99%% 7.63% 6.29% 5.84%
PAT 0.80 Cr. 2.46 Cr. 2.37 Cr. 2.98 Cr.
PAT Margins 3.67%% 2.40% 2.28% 2.93%
CFOA 3.73 Cr. 0.42 Cr. (11.12) Cr. 5.82 Cr.

Comparison With Peers:

Companies Revenue EBITDA PAT MCap P/E
Neelam Linens and Garments (FY 2024) 102.33 Cr. 7.81 Cr. (7.63%) 2.46 Cr. (2.40%) 48.52 Cr. 19.72
Loyal Textile Mills Limited (FY 2024) 939 Cr. (36 Cr.) (40) Cr. 256 Cr. Loss Making
Bannari Amman Spinning Mills Limited (TTM) 1,041 Cr. 30 Cr. (17) Cr. 389 Cr. Loss Making

Recommendation on Neelam Linens and Garments (India) Ltd IPO:

Review and Recommendation of Neelam Linens and Garments by team IZ is 3/10.

Lead Manager of Neelam Linens and Garments (India) Ltd IPO:

  1. Expert Global Consultants Private Limited

Registrar of Neelam Linens and Garments (India) Ltd IPO:

  1. Purva Sharegistry India Private Limited

Company Address:

Neelam Linens and Garments (India) Ltd 446-447, 4th Floor, Shah & Nahar Industrial Estate Sitaram Jadav Marg Lower Parel, Delisle Road, Mumbai- 400013 Phone: +91 2224942454 Email: compliance@neelamgarments.com Website: http://neelamgarments.com/

Discussion on Neelam Linens and Garments (India) Ltd IPO:

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