Finbud Financial Services Ltd. IPO

Shree Balaji (Mala) Textiles 

• Shree Balaji (Mala) Textiles is coming out with an initial public offering (IPO) of 27,00,000 shares in a price band of Rs 66-70 per equity share.
• The issue will open on July 22, 2026 and will close on July 24, 2026.
• The shares will be listed on SME Platform of BSE.
• The face value of the share is Rs 10 and is priced 6.60 times of its face value on the lower side and 7.00 times on the higher side.
• Book running lead manager to the issue is GYR Capital Advisors.
• Compliance officer for the issue is Naina Saha.

Profile of the company

Shree Balaji (Mala) Textiles, is a contract manufacturer and wholesaler of cotton sarees in India’s B2B cotton sarees wholesale segment. Its Promoter’s experience in cotton sarees segment dates back to the year 1990’s, wherein its Promoter was engaged in the trading of cotton sarees. Gradually it shifted its business model from trading to pure play manufacturing of cotton sarees on job work basis and that is when along with getting manufacturing done at designated job work units, it also started its manufacturing facility in Jetpur in the name of Shree Brindavan Chandra Prints. Its products are recognised in textile industry under its own brand name ‘Mala Saree’. The company operates into B2B business model, focusing on selling its products through a network of around more than 105 brokers, around 13 dealers, 69 wholesaler and around 3000 retailers as of March 31, 2026 spread across Central, East, North, Northeast, South and West parts of India. 

Its products are manufactured through job workers as well as at its own manufacturing facility. The processes which are inherent in the manufacturing of cotton sarees are carried out both by the job workers and at its manufacturing facility. Around 95% of its products are manufactured through job workers. In the cotton saree manufacturing industry, a significant portion of manufacturing is carried out through job work units. This operating model is adopted to strategically leverage the inherent advantages of job work arrangements, primarily; i) contract manufacturers typically operate large-scale facilities that offer economies of scale, enabling cost efficient production, and ii) they are strategically located within established textile hubs, where access to raw materials, skilled labour, and efficient, cost-effective transportation infrastructure is readily available. By engaging job workers, it is able to optimize operational efficiency, manage costs effectively, and benefit from the well-developed textile ecosystem without incurring substantial capital expenditure on in-house manufacturing facilities. 

Proceed is being used for:

• Funding the working capital requirements of the company.
• General corporate purposes 

Industry overview

India’s textiles sector is one of the oldest and most diverse industries in the country, with roots stretching back centuries. It spans from traditional hand-spun and handwoven clusters to sophisticated capital-intensive mills, supported by a robust base of fibres and yarns ranging from cotton, jute, silk, and wool to polyester, viscose, and acrylic. The decentralised power loom, hosiery, and knitting segment remains the largest component, reflecting the industry’s ability to cater to multiple consumer markets. Its close linkage with agriculture, reliance on natural resources like cotton, and strong cultural heritage give the Indian textiles industry a unique identity compared to other manufacturing sectors. 

The market for Indian textiles and apparel is projected to grow at a 10% CAGR to reach $2.3 billion by 2030. India ranks among the top five global exporters in several textile categories, with exports expected to reach $100 billion. The textiles and apparel industry contribute around 2% of India’s GDP and about 11% of manufacturing GVA (Gross Value Added) as of February 2026. The textile industry in India is predicted to double its contribution to the GDP to around 5% by the end of this decade. Global fibre demand is expected to reach around 149 million tonnes in 2030, with increasing population and growth in per-capita consumption. 

The Indian Technical Textiles market is the fifth largest in the world. The technical textiles industry was valued at $29 billion in 2024 and is projected to grow to $45 billion by 2026, $123 billion by 2035, and $309 billion by 2047. The India mobiltech textile market (a division of technical textiles for automotive use) is projected to grow from $2.32 billion in FY25 to $4.57 billion by FY33, at a CAGR of 8.84%. This growth is driven by rising demand for advanced materials, electric vehicles, and sustainability focus.

Pros and strengths

Ability to buy in bulk quantities: The company possesses the capacity to procure products in large quantities from its weavers/ suppliers due to several key advantages including having the ability to provide its customers a variety of options, wide customer base and available operational cash flows. Its Mala saree showroom located in the heart of the city and hub of the cloth market in Kolkata collectively span over an aggregate area of 3774 sq. ft which enables it to realize several advantages such as ensuring consistent inventory availability and mitigating additional costs associated with placing frequent small orders. It also has 4 warehouses all located near its showroom that enables it to adequately store the inventory and also enables to and for movement of the inventory from the warehouse to the showroom. 

Wide Geographic presence: Since its promoters have been involved in this business for almost three decades, it has developed long standing relationships with its brokers, dealers, wholesalers and retailers. Its products are generally sold through a network of wholesalers located at different locations of the country. As on March 31, 2026, its dedicated Sales and Marketing team comprises of 19 members excluding the management, actively engaging with potential clients, building strong relationships through personal interactions and a deep understanding of their needs. By leveraging its local market connections, it taps into a vast network of wholesalers, which helps it expand its market presence. Its sales strategy ensures that it maintains a strong market presence, continuously identifying new opportunities while reinforcing its relationships with existing customers.

Vast and versatile product portfolio for women: Its product portfolio is vast and versatile in Indian wear for women’s apparel segment. The sarees products offered by it are further bifurcated by occasion, fabric, weave, pattern and most of its revenue is generated from sale of cotton sarees. It focuses on trending fashion designs with an emphasis on quality to offer new and varied products to its customers throughout the year. It has always aimed at offering its products across all culture, its products are finely created keeping in mind the festive occasions, by inculcating all traditional varieties. This has always been its strength over the years as it has always focused on reaching customers across all cultures and traditions, since India is a diverse land of cultures and traditions.

Risks and concerns

Revenue concentration on single product: Its business is currently highly concentrated on a single product, i.e., cotton sarees. Almost all its revenue is generated from the sale of cotton sarees. Its revenue generated from Cotton Saree segment for the period ended March 31, 2026, March 31, 2025 and March 31, 2024 is Rs 19,235.53 lakh (i.e. 90.75% of the total revenue), Rs 17,447.10 lakh (i.e. 90.39% of the total revenue) and Rs 18,272.29 lakh (i.e. 93.45% of the total revenue) respectively. Its results of operations are dependent on its ability to attract customers by anticipating and responding to changes in customer preferences and modify its existing products in line with changes in customer demands and preferences. The number of customers demanding women’s ethnic wear may not continue to increase. If it is unable to anticipate and gauge customer preferences, or if it is unable to adapt to such changes in a timely basis or at all, it may lose or fail to attract customers, its inventory may become obsolete and it may be subject to pricing pressure to sell its inventory at a discount.

Dependence on distribution channel partners: Its business is dependent on network of retailers, wholesalers and dealers with the maximum contribution by the retailers. Its retailers contribute around 46.13%, 46.70% and 27.77% of its revenues from operations for the year ended March 31, 2026, March 31, 2025 and March 31, 2024. The composition and revenue generated from these retailers might change as it continues to add new partnership in normal course of business. Any decline in its quality standards, growing competition and any change in the demand for its products by these customers may adversely affect its ability to retain them. It has maintained good and long-term relationships with its customers. However, there can be no assurance that it will continue to have such a long-term relationship with them. Also, any delay or default in payment by these customers may adversely affect its business, financial condition and results of operations. It cannot assure that it shall generate the same quantum of business, or any business at all, from these customers, and loss of business from one or more of them may adversely affect its revenues and profitability.

Revenue concentration in the Eastern Region: The company has PAN India presence however its revenue is concentrated in the one region i.e.; Eastern India. It generated almost 90.97%, 89.27%, and 91.02% of the total Revenue generated for the financial year ended March 31, 2026, 2025 and 2024 respectively. Such geographical concentration of its business in the Eastern region heightens its exposure to adverse developments related to competition, as well as economic and demographic changes in the region, which may adversely affect its business prospects, financial conditions and results of operations.

Outlook

Shree Balaji (Mala) Textiles is engaged into designing, manufacturing and wholesale business of variety of high-quality cotton sarees. It manufactures its products through job workers who are mostly located in Jetpur, Mumbai, Kolkata, Rajkot and Surat and a majority of them have been working with it for a substantially long period of time. It also exercises regular supervision over the manufacturing operations at the facilities of its job workers through its personnel who are either stationed at such facilities or periodically visit these facilities for inspections, enabling it to efficiently carry out production changes in designs or quantity of products required. On the concern side, it has maintained a long-term relationship with many of its suppliers and it has been able to negotiate favourable credit terms from them due to increased order sizes and timely payments, it cannot assure that it shall be able to maintain such favourable credit terms in future. In this regard, for the financial year ended March 31, 2026, March 31, 2025 and March 31, 2024, its top 10 suppliers contributed around 47.83%, 57.52%, and 60.08% respectively of its purchases. Failure to successfully leverage its relationships with existing suppliers or to identify new suppliers could adversely affect its business operations.

The company is coming out with a maiden IPO of 27,00,000 equity shares of face value of Rs 10 each. The issue has been offered in a price band of Rs 66-70 per equity share. The aggregate size of the offer is around Rs 17.82 crore to Rs 18.90 crore based on lower and upper price band respectively. On performance front, the revenue from operations of the company for FY25-26 was Rs 21,197.18 lakh as against Rs 19,304.37 lakh for FY24-25, an increase of 9.81%. Profit after tax for the FY25-26 was at Rs 585.42 lakh against profit after tax of Rs 494.61 lakh in FY24-25, a surge of 18.36%.

Meanwhile, in the realm of wholesale, robust inventory management practices are not just a part of the business; they are its very core. The ability to maintain the right mix and quantity of inventory at the store level is a fundamental driver of enhanced sales and profitability. Its strategic approach revolves around a continuous cycle of review, replenishment and product innovation to ensure a fresh and appealing selection is always available to its customers, thus preventing monotony and driving sustained interest. Going forward, it intends to focus on strengthening its sales through e-commerce channels to benefit from evolving customer trends. It intends to make investments in digital channels to build an omni-channel engagement experience for its customers (both B2B and B2C) and has a dedicated team for its e-commerce operations. It anticipates that such investments will increase its profitability and revenue from operations and diversify its revenue generating channels.