The textile and garment manufacturing industry in India has always been a mix of traditional and modern. Kaytex Fabrics, an Amritsar-based fast fashion fabric solutions company, is a perfect example of this blend. With its IPO opening on 29 to 31 July 2025, the company is making headlines for its strong financials, technology adoption, and cross-segment presence. Here is an investor-centric Kaytex Fabrics IPO review based on financials and operational insights.
Kaytex Fabrics IPO Review: Offer Snapshot
- IPO Open Dates: 29 July 2025 to 31 July 2025
- Price Band: INR 171 – 180 per share
- Total Issue Size: 38,78,400 shares (INR 66.32 – 69.81 crore)
- Fresh Issue: 31,99,200 shares (INR 54.71 – 57.59 crore)
- Offer for Sale (OFS): 6,79,200 shares (INR 11.61 – 12.23 crore)
- Lot Size: 1,600 shares (Minimum investment of INR 2,88,000)
- Retail Quota: 35%
- Listing Platform: NSE EMERGE
- Listing Date: 05 August 2025
- Book Running Lead Manager: Socradamus Capital
- Registrar to the Issue: Bigshare Services
Kaytex Fabrics IPO Review: Business Overview
Founded in 1996, Kaytex Fabrics began as a traditional textile manufacturer in Amritsar, Punjab. Over nearly three decades, it has evolved into a vertically integrated, technology-driven fashion and fabric company. With expertise in end-to-end production — from yarn to finished product — the company serves both branded and non-branded markets.
The core offerings include:
- Fabrics from diverse fibres: cotton, viscose, modal, acrylic, nylon, linen, and polyester
- Garment categories: Ready-to-stitch suits, co-ord sets, shawls, scarves, and stoles
- Tech capabilities: Digital printing, jacquard weaving, computerized embroidery, dyeing, and processing
Kaytex operates on a three-pronged model:
- Brand enabler for apparel brands
- Own branded products (Rasiya, Kaytex, Darbaar-e-Khaas)
- Non-branded bulk offerings to wholesalers and retailers
Financial Performance Snapshot
Kaytex Fabrics has exhibited solid financial growth over the last three fiscal years. Below are the key numbers:
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenue | 99.19 | 124.94 | 152.79 |
| Expenses | 91.14 | 109.83 | 131.30 |
| Net Income | 5.59 | 11.31 | 16.90 |
| EPS | 4.86 | 9.83 | 14.70 |
| ROCE (%) | 25.81 | 32.72 | 33.25 |
| RONW (%) | 26.45 | 33.71 | 33.76 |
| EBITDA Margin (%) | 12.89 | 17.95 | 19.68 |
| Debt/Equity | 1.28 | 1.06 | 0.76 |
The consistent improvement in margins, return ratios, and debt reduction is a promising sign for potential investors.
Valuation & Peer Comparison
At the upper band of INR 180, the stock is priced at a P/E ratio of 12.24, based on FY 2025 EPS of INR 14.70. This is notably lower than its listed peers:
| Company | CMP (INR) | EPS (INR) | P/E | RONW (%) | Revenue (INR Cr.) |
|---|---|---|---|---|---|
| Kaytex Fabrics | INR 180 | 14.70 | 12.24 | 33.76 | 152.79 |
| Veekayem Fashion | 246.10 | 13.01 | 18.92 | 13.76 | 321.29 |
| Banswara Syntex | 145.01 | 6.25 | 23.20 | 3.83 | 1,291.70 |
| Donear Industries | 107.73 | 6.13 | 17.57 | 13.59 | 913.70 |
Kaytex offers a compelling valuation advantage along with superior return on net worth.
Revenue Mix & Geographic Penetration
Kaytex Fabrics’ revenue is dominated by product sales, accounting for over 91% in FY 2025:
| Revenue Type | FY 2023 (%) | FY 2024 (%) | FY 2025 (%) |
|---|---|---|---|
| Product Revenue | 83.21 | 84.97 | 91.26 |
| Service Revenue | 16.15 | 14.42 | 8.12 |
| Others | 0.64 | 0.61 | 0.62 |
Geographic Revenue Distribution (FY 2025):
- Tier 2 Cities: INR 102.49 crore
- Tier 3 Cities: INR 32.39 crore
- Tier 1 Cities: INR 11.26 crore
- Exports (UAE and Saudi Arabia): INR 6.65 crore
This cross-segment strategy—from Tier 1 urban markets to Tier 3 rural areas—provides a cushion against economic cyclicality and supports diversified revenue streams.
Strategic Use of IPO Proceeds
The company intends to raise INR 66.32 – INR 69.81 crore and will allocate the net proceeds as follows:
| Purpose | Estimated Amount (INR Cr.) |
|---|---|
| Warehouse facility (Amritsar) | 2.56 |
| Dedicated sales office (Amritsar) | 3.73 |
| Advanced fabric processing system | 5.01 |
| Incremental working capital | 30.0 |
| General corporate purposes | [To be finalized] |
A large chunk—over INR 30 crore—is being infused into working capital, indicating growth ambitions and operational expansion.
Technology-Led Manufacturing
Kaytex Fabrics is a pioneer in digital textile printing, a method that allows photo-realistic, customized, and fast-to-market textile solutions. The company uses:
- Reactive & sublimation printing machines (Hopetech)
- Jacquard looms (Sulzer, Vamatex, Somet)
- Computerised embroidery machines (Zhejiang Yuelong)
- Weaving machinery (Sulzer)
- Dyeing units (Harish)
These technologies not only give design flexibility and reduce lead times but also align with the sustainability trend—critical in today’s fashion ecosystem.
Competitive Advantages
- Integrated Production Facility: Kaytex Fabrics does everything from design to weaving, printing, embroidery and finishing under one roof, ensuring quality, speed and cost.
- Digital Printing Leadership: The company is well-positioned to benefit from the global digital textile printing market which is expected to reach USD 11.67 billion by CY 2030, growing at 12.8% CAGR. The Indian segment is expected to reach USD 1.21 billion by the same time, and offers strong domestic tailwinds.
- Cross-Segment Market Presence: Kaytex’s strategy is to be present in Tier 1 to Tier 4 cities and from branded to unbranded segments, ensuring a wide customer base and revenue stability.
- Strong Distribution & Customer Network: As of 31 March 2025: 154 distributors, 71 brokers/agents, 497 total customers, 268 new customers added in the last 2 years. The top 20 customers contributed only 55.08% of revenue in FY 2025, low customer concentration risk.
- Consistent Quality & Innovation: In-house design team creates seasonal collections and custom patterns. Design spend has increased from INR 1.15 crore in FY 2023 to INR 2.04 crore in FY 2025; innovation is a priority.
Kaytex Fabrics IPO Review: Risk Factors
- 89.68% of revenue in FY25 came from North India; 68.26% from Punjab, so region-specific socio-political, economic and natural disaster risks.
- Working capital requirement has gone up from INR 29.88 crore in FY23 to INR 61.30 crore in FY25; INR 30.00 crore from IPO proceeds is being allocated to working capital in FY26.
- Digital printing capacity utilization has fallen to 58.90% in FY25 despite installed capacity increasing to 92.16 million metres, so the risk of underutilization affecting profitability through unabsorbed fixed costs.
- As of 31 March 2025, Kaytex Fabrics has INR 0.26 crore in contingent liabilities, including INR 0.26 crore in direct tax-related claims which may impact financials if materialized.
- 6 e-proceedings and 2 criminal cases for INR 0.14 crore against the company and further tax defaults by promoters, which are legal and reputational risks.
Conclusion
Kaytex Fabrics is a good investment opportunity for long-term investors looking to invest in India’s textile sector. Strong financials, efficient operations, latest technology and strategic market presence make the issue look good compared to peers. Low P/E, high return ratios and a lot of growth left make it look good for investors who are bullish on digital printing and fast fashion in India.
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