Is NAPS Global India IPO Good or Bad - Detailed Review

NAPS Global India IPO is kicking off its initial public offering which will be open from March 04, 2025, to March 06, 2025. While considering applying for this IPO, certain questions may arise in your mind, including whether the NAPS Global India IPO is good or bad, whether it is worth investing in this IPO, and so on. 

This article offers a comprehensive NAPS Global India IPO review, covering its business operations and fundamental analysis to help you make an informed investment choice.

NAPS Global India IPO Review

NAPS Global India Limited, a B2B fabric and garment supplier, has shown remarkable revenue growth over the years, benefiting from India's expanding textile industry. The company operates on an asset-light model, ensuring cost efficiency and maximizing returns. With a return on average equity (ROAE) of 59.15% and a return on capital employed (ROCE) of 47.47%, it has consistently delivered strong financial performance and high returns to shareholders.

However, investors should consider key risks. The company heavily relies on imports from China and Hong Kong for its raw materials, making it vulnerable to supply chain disruptions, currency fluctuations, and changes in trade policies. 

Investors looking for a high-growth B2B textile business with strong financial metrics may find this IPO appealing, but they should carefully evaluate its import dependency and margin sustainability before making investment decisions

Company Overview of NAPS Global India IPO

NAPS Global India Limited is a well-known wholesale importer of textile products based in Mumbai, Maharashtra. Since its founding in 2014 by Pankaj Jain and Ronak Mistry, the company has grown from a small textile business to a key supplier in the garment manufacturing supply chain, serving businesses across India.

The company follows a business-to-business (B2B) model, focusing on bulk supply to manufacturers and wholesalers rather than retail consumers. By using an asset-light strategy, NAPS Global India Limited avoids the high costs of maintaining multiple physical stores. Instead, it operates efficiently through its registered office and warehouse, ensuring cost optimization, lower overhead expenses, and competitive pricing.

NAPS Global India Limited offers a wide variety of fabrics and garments. Its fabric range includes:

• Cotton fabrics

• Super-soft velvet fabrics

• Knitted fabrics

• Linen and man-made fabrics

In the garment segment, the company supplies:

• Women’s tops

• Men’s shirts and t-shirts

• Kids' wear

• Jeans

The company has a well-established distribution network across India, ensuring the smooth delivery of products to its clients. It also has strong relationships with suppliers in China and Hong Kong, which help maintain a consistent supply of high-quality textile products.

By leveraging its cost-efficient operations and scalable business model, NAPS Global India Limited continues to grow and remain competitive in the rapidly expanding textile industry.

Industry Overview of NAPS Global India IPO

The Indian textile industry is one of the largest and oldest sectors of the country’s economy, contributing approximately 2.3% to India’s GDP (Source: IBEF) and employing millions of people. With a wide range of activities from fibre production to garment manufacturing. 

The industry was valued at approximately $1,837.27 billion in 2023 and is set to grow at a rate of around 7.4% annually till 2030. The imports of textiles in India have increased significantly, and NAPS Global India is benefiting directly from this. The well-established supply chain and proximity to major ports contribute to its growth.

Financial Overview of NAPS Global India IPO

NAPS Global has shown incredible growth over the last 3 years. As of December ended FY25, the company’s revenue was doubled to Rs.52.83 crore when compared to FY23, which was Rs.26.01 crore. Furthermore, there has been an increase in revenue from Rs.13.48 crore in FY22 to Rs.47.31 crore in FY24 showing the company’s growing market presence and strong sales momentum.

The net profits of the company as of FY24 stood at Rs.1.45 crores reflecting a net profit margin of 3.07%. These low margins can be attributed to the cost of purchasing the fabric and garments it imports from its suppliers. However, we can see that these margins have improved over the last three financial years from 1.37% to 3.07%.

Talking about the returns generated, we can see the company has consistently increased its ROAE and ROCE each financial year. As of FY24, the ROAE and ROCE of the company stood at 59.15% and 47.47%, respectively. This suggests that the company has given exceptional returns to the shareholders and has also optimally utilized its overall resources.

Strengths and Risks of NAPS Global India IPO

Let’s dive into the strengths and weaknesses to assess if NAPS Global India IPO is good or bad for investors

Strengths  

• A Diverse Range of Products—The company offers a slew of fabric options like cotton, knitted, linen, etc. This allows the company to cater to various market segments.

• Growth of the Textile Market—The textile market in India is growing rapidly and is expected to reach a valuation of approximately $350 billion by the year 2030.

• Strong Supplier Network: The company sources fabric from countries like China and Hong Kong, ensuring cost-effective procurement and consistent supply.

• High Profitability: With an ROE of 59.15% and ROCE of 47.47%, the company demonstrates strong financial efficiency and effective capital utilisation.

• High return on capital employed (ROCE) due to an asset-light model.

Risks

• Domestic Competition—Domestic players offer locally sourced products, which are cheaper than imported products.

• International Dependency—NAPS Global heavily relies on international entities for its products. Competition is vulnerable to currency fluctuations and trade relations between countries.

• Cash Flow History—NAPS has a history of negative cash flows, which indicates a potential challenge in the usage of cash reserves. 

• Financial Risk—A significant portion of the company's assets are used as collateral against short-term loans to maintain inventory and cash reserves.

NAPS Global India IPO Vs Peers

Let’s conduct a peer comparison to assess whether it’s worth investing in NAPS Global India IPO

Figures as of FY24

When comparing NAPS to its other listed peers, we can see that, with revenue of Rs.31 crores, the company is the biggest one on the list. While the company stands low on the net profit margins compared to its competitors, it has generated the highest returns to the shareholders and has also shown the highest efficiency in its overall operations, which is indicated by its ROAE and ROCE.

Objectives of NAPS Global India 

The company plans to allocate funds raised from the IPO to strengthen its financial position and fuel future growth. The key areas where the funds will be utilised include:

• Working Capital Requirements—Rs 919.00 lakhs will be dedicated to maintaining smooth business operations, ensuring steady procurement of fabrics, and managing inventory efficiently to meet growing customer demands.

• General Corporate Purposes—Rs 169.00 lakhs will be used for business expansion, operational improvements, and strengthening the company’s overall financial health.

NAPS Global India IPO Details

IPO Dates

NAPS Global India Limited IPO will be open for subscription from March 4, 2025, to March 6, 2025. The allotment of shares to investors will take place on March 7, 2025, and the company will be listed on the BSE SME on March 11, 2025.

IPO Issue Price

NAPS Global India Limited is offering its shares at a fixed price of Rs. 90 per share. Investors need to purchase a minimum of 1,600 shares per lot, meaning an investment of Rs. 1,44,000 per lot is required to bid for the IPO.

IPO Size

The total issue size of NAPS Global India Limited IPO is Rs. 11.88 crore. The funds raised will be utilized for business expansion, strengthening supply chain networks, and working capital requirements.

IPO Allotment Status

Investors who applied for the IPO can check their IPO allotment status on March 7, 2025 through the registrar's website or their stockbroker platform.

IPO Listing Date

The shares of NAPS Global India Limited will be listed on the BSE SME on March 11, 2025.

IPO Application Link

Open a demat account with Rupeezy today and enjoy a seamless experience when applying for the IPO. With an easy-to-use platform, Rupeezy makes the IPO application process quick and hassle-free.

Apply for NAPS Global IPO

NAPS Global India IPO GMP

Investors often check the NAPS Global India IPO GMP for market sentiment and listing price hints. However, GMP doesn’t reflect financial strength, so a financial analysis is crucial before investing.

NAPS Global India IPO Details