Sanathan Textiles, a prominent player in the Indian textile industry, has announced its highly anticipated Initial Public Offering (IPO), marking a pivotal step in its growth journey. The IPO comprises a mix of a fresh issue of ₹400 crore and an offer for sale (OFS) of ₹150 crore by promoter selling shareholders, aggregating to a total issue size of ₹550 crore. This strategic move underscores the company’s commitment to scaling its operations and strengthening its presence in both domestic and international markets.
As one of the few companies in India with a robust presence across polyester, cotton, and technical textile sectors, Sanathan Textiles has emerged as a leader in the textile yarn industry. Leveraging a diversified product portfolio, state-of-the-art manufacturing capabilities, and a strong commitment to sustainability, the company continues to set benchmarks in the industry. With plans for significant capacity expansion and innovation, Sanathan Textiles is poised to capitalize on the growing demand for textile products globally and drive long-term value creation for stakeholders.
Diverse Product Portfolio
Sanathan Textiles operates three distinct yarn business verticals: polyester yarn products, cotton yarn products, and yarns for technical textiles and industrial uses. As of September 30, 2024, the company offers over 3,200 active varieties of yarn products and maintains more than 45,000 stock-keeping units (SKUs). Their capabilities extend to manufacturing a vast portfolio of over 14,000 yarn varieties and 190,000 SKUs for diverse applications, including automotive, healthcare, construction, sportswear, and protective clothing.
A key differentiator for Sanathan Textiles lies in its focus on value-added products. The company manufactures specialized yarns such as dope-dyed, superfine/micro, functional, industrial, and technical yarns, as well as cationic dyeable and specialty yarns. These products, created through extensive in-house research, are customized to meet specific customer requirements and are recognized for their distinctive properties.
State-of-the-Art Manufacturing Facility
Sanathan Textiles operates a fully integrated manufacturing facility in Silvassa, which, as of June 30, 2024, boasts an impressive installed capacity of 223,750 MTPA across its three yarn verticals. The facility includes a continuous polymerization plant equipped with advanced technologies such as automatic metering, temperature control, torque sensors, and computer-assisted operations. This enables the production of made-to-order and high-value yarn products with exceptional flexibility and precision.
Additionally, the company has implemented a Zero Liquid Discharge Solution at its Silvassa plant, ensuring minimal environmental impact by eliminating industrial wastewater discharge into surface waters. Reinforcing its sustainability initiatives, Sanathan Textiles produces yarn products using recycled materials under the brand Sanathan Reviro.
Strategic Investments and Expansion Plans
To further strengthen its market position, Sanathan Textiles is in the advanced stages of commissioning a greenfield manufacturing facility in Wazirabad, Punjab. Spread across 80 acres, this facility is being established through its wholly-owned subsidiary, Sanathan Polycot Private Limited, and will focus exclusively on polyester yarn production. This expansion is expected to significantly enhance the company’s manufacturing capacity and product offerings.
The company has also made notable strides in renewable energy adoption. As of June 30, 2024, rooftop solar projects at its Silvassa facility contribute 2.35 MW of energy, with renewable sources accounting for 0.86% of the total energy consumed.
Growth Potential in a Booming MarketThe global yarn industry is poised for steady growth, driven by increasing demand from the fashion industry and the rapid rise of e-commerce platforms. According to a CRISIL report, the Indian textile and apparel industry is expected to grow at a CAGR of 6.0%-7.0% between Fiscal 2024 and Fiscal 2028. During this period, domestic demand is projected to expand at a faster pace of 7.0%-8.0%, while exports are anticipated to grow at 4.5%-5.5% CAGR.
Factors such as rising discretionary income, urbanization, and the shift from cotton to man-made fibers will play a pivotal role in driving demand. Additionally, the robust growth of the technical textiles segment and the diversification of the global textile industry beyond China are expected to provide a substantial boost to Indian exports.
Long-Standing Customer Relationships
Sanathan Textiles’ scale of operations, vast distribution network, and consistent product quality have earned the trust of renowned consumer brands. The company caters to a wide array of industry leaders, including Welspun India Limited, Page Industries Limited, D’Decor Home Fabrics Private Limited, Wildcraft India Limited, Siyaram Silk Mills Limited, and SRF Limited, among others. These enduring partnerships underscore the company’s commitment to excellence and innovation.
With its diverse product portfolio, cutting-edge manufacturing capabilities, and strategic expansion plans, Sanathan Textiles is set to strengthen its leadership in the Indian and global textile industry. The upcoming IPO marks a pivotal milestone, enabling the company to capitalize on emerging growth opportunities while maintaining its focus on innovation, sustainability, and customer satisfaction. Sanathan Textiles is not only redefining industry standards but also paving the way for a sustainable and dynamic future in textile manufacturing.