Cotton fabrics producer Sonaselection India files draft IPO papers for debt reduction, capex

Sonaselection India IPO News

Rajasthan-based cotton fabrics producer Sonaselection India has filed draft red herring prospectus (DRHP) with the SEBI to raise funds via IPO for debt reduction and to fund its capex.

The initial public offering (IPO) comprises entirely a fresh issue of 1.43 crore equity shares by the company with no offer-for-sale (OFS) component.

The textile company plans to utilise Rs 80 crore of IPO proceeds for repayment of partial debt. As of October 2025, its total outstanding borrowings from banks stood at Rs 233.5 crore.

Further, Rs 47.6 crore will be used for purchase of plant and machineries at the existing manufacturing facility, and the remainder funds for general corporate purposes.

Incorporated in 2022, Sonaselection India, which competes with listed peers like Vishal Fabrics, Sangam (India), and Nitin Spinners, has tranformed itself from a job-work based model to a manufacturing model by setting up a cotton fabric processing plant in July 2024. In addition to core manufacturing and processing operations through Bhilwara (Rajasthan) plant, it has recently expanded into the readymade garments segment through subsidiary incorporated in July 2025.

Further, the company that operates fibre-to-fabric value chain is also in the process of establishing another 1.10 MW rooftop solar power plant for captive consumption, in addition to existing 0.26 MW rooftop solar plant.

Financial performance of the company in the recent past periods has been healthy, with profit in the fiscal 2025 growing 41.8 percent to Rs 18.6 crore, increasing from Rs 13.1 crore in previous year. Revenue during the same period surged 161.2 percent to Rs 316 crore, up from Rs 121 crore.

Profit stood at Rs 4.8 crore for the first quarter of current financial year 2025-26, on topline of Rs 104.2 crore.

The sole merchant banker managing the Sonaselection India IPO will be Choice Capital Advisors.