Kusumgar's ₹650 crore IPO opens on July 8, featuring a 33% grey market premium. The offer is entirely for sale, with two SME IPOs also scheduled.
New Delhi, India Jul 4, 2026 ALN: The primary market is set to witness limited mainboard activity next week, with the Kusumgar IPO emerging as the most significant offering for investors to consider. Kusumgar, a company specializing in engineered fabrics, is scheduled to open its public issue for subscription on July 8 and will close on July 10. The company aims to raise ₹650 crore through this initial public offering (IPO). Notably, in the grey market, Kusumgar's shares are reportedly commanding a grey market premium (GMP) of 33% over the issue price, indicating strong investor interest and positive sentiment surrounding the offering.
The Kusumgar IPO is structured entirely as an offer for sale, involving the sale of 1.55 crore shares. This means that the company itself will not receive any fresh capital from the IPO; instead, the proceeds will go directly to the selling shareholders. The price band for the IPO has been set at ₹398 to ₹419 per share, with the total issue size reaching ₹650 crore at the upper price point. Following the subscription period, the shares are proposed to be listed on both the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), with a tentative listing date scheduled for July 15.
The minimum bid size for retail investors is fixed at 35 shares, translating to a minimum investment of ₹14,665 at the upper end of the price band. The allotment of shares is expected to be finalized on July 13, with refunds and the credit of shares anticipated to occur on July 14. The book-running lead manager for this IPO is Axis Capital, while Bigshare Services has been appointed as the registrar, overseeing the administrative aspects of the offering.
Kusumgar, which was incorporated in 1990, focuses on the production of woven, coated, and laminated synthetic fabrics, commonly referred to as engineered fabrics. The company’s products are primarily derived from polyamide and polyester filaments and cater to specialized applications across various sectors, including aerospace and defense, industrial and automotive sectors, as well as outdoor and lifestyle products. This diversification in product offerings positions Kusumgar uniquely within the market, particularly as it has also ventured into the production of finished goods for aerospace and military applications. These products include parachute systems, stealth materials, camouflage nets, deployable shelters, and rapid deployment systems, which help to differentiate this IPO from the more typical consumer, financial services, or technology listings that dominate the mainboard market.
One of the notable aspects of Kusumgar's business is the technical entry barriers associated with its operations. Clients in the defense, aerospace, and industrial sectors often require specialized products that meet rigorous testing standards and long approval cycles. This requirement for technical expertise and compliance can limit competition in the market. Kusumgar claims to have developed over 1,000 different types of fabric, supported by a workforce of more than 2,000 employees, contributing to its operational capacity and innovation potential.
However, it is essential to consider the company's recent financial performance, which has raised some concerns among potential investors. In the fiscal year 2026, Kusumgar reported a revenue decline of 10%, with figures dropping to ₹711.78 crore from ₹790.21 crore in the previous fiscal year. Additionally, the profit after tax decreased by 12%, falling to ₹98.20 crore from ₹111.99 crore. The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) remained relatively flat at ₹187.85 crore. On a positive note, Kusumgar’s net worth improved significantly, rising to ₹502.95 crore from ₹257.75 crore, while the total borrowings amounted to ₹223.58 crore at the end of March 2026. This financial backdrop will be a critical factor for investors to evaluate as they consider the potential risks and rewards associated with the IPO.
Given that the Kusumgar IPO is a pure offer for sale, investors will pay close attention to the company's valuation, growth outlook, and the demand dynamics from its key sectors, particularly in defense, aerospace, and performance fabrics. The timing of this IPO is particularly noteworthy, as there has been a growing interest in specialty manufacturing and defense-linked businesses within the Indian market. This trend reflects broader global shifts towards increased defense spending and the need for advanced materials in various applications, which could bode well for Kusumgar's future growth prospects.
The issue will adhere to the standard reservation structure typically seen in IPOs. This structure allocates not more than 50% of the net offer for qualified institutional buyers, a minimum of 35% for retail investors, and at least 15% for non-institutional investors. This distribution aims to ensure a balanced approach to attracting different types of investors, thereby enhancing market participation.
In addition to the mainboard IPO activity, the SME IPO market is also expected to remain active next week. Happy Steels is set to open its ₹25 crore NSE SME issue on July 9, with the subscription period concluding on July 13. The price band for this offering has been established at ₹62 to ₹66 per share. Furthermore, Devson Catalyst is also scheduled to open on July 9 and close on July 13, with its BSE SME issue size estimated at approximately ₹42.34 crore, and a price band ranging from ₹112 to ₹118 per share.
The activity in the SME IPO segment indicates a robust appetite for new investment opportunities among smaller companies, as investors seek to diversify their portfolios and tap into growth potential outside of the traditional large-cap stocks. The SME market plays a crucial role in the overall landscape by providing smaller enterprises with access to capital, which can be instrumental in fueling innovation, expansion, and job creation.
As the IPO landscape evolves, both the mainboard and SME will be closely watched by investors, analysts, and market participants. The performance of these offerings will be indicative of broader market trends and investor sentiment, particularly in sectors that are witnessing significant growth and transformation.
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