IPO Overview
Founded in 2018, Harikanta Overseas Limited is engaged in the manufacturing of synthetic textile fabrics used across multiple apparel categories. The company’s product portfolio includes Ikat fabrics, polyester garment fabrics, saree fabrics, Dhupion fabrics, poly linen, and natural fibre fabrics. A significant portion of its production is used in women’s wear, particularly sarees, dress materials, and kurtas, while the company also supplies fabrics for men’s kurtas. The business traces its origins to the family enterprise started by the promoters’ grandfather, Mr. Harivadan Gangaram Gotawala, who initially operated manual power looms. Operations were later expanded by Mr. Kamlesh Gotawala, followed by Mr. Nilesh Gotawala, who continued managing and growing the business after 1997.
Harikanta Overseas is a Surat-based synthetic textile fabric manufacturer with a strong export orientation, generating approximately 64% of its FY25 operating revenue from exports to Cambodia, Thailand, Bahrain, and Singapore. The company is launching its SME IPO on the BSE SME platform to raise ₹25.63 crore through a 100% fresh issue of 26.70 lakh equity shares at a price band of ₹91–₹96 per share. The IPO opens on 20 May 2026 and closes on 22 May 2026, with listing expected on 27 May 2026.
IPO Detailed Information
Issue Details
| Parameter | Details |
| IPO Type | Book Built – SME |
| Listing Exchange | BSE SME |
| IPO Open Date | 20 May 2026 |
| IPO Close Date | 22 May 2026 |
| Allotment Date | 25 May 2026 (Expected) |
| Credit to Demat | 26 May 2026 |
| Listing Date | 27 May 2026 (Tentative) |
| Price Band | ₹91 – ₹96 per share |
| Face Value | ₹10 per share |
| Lot Size | 1,200 shares |
| Minimum Investment (Retail) | ₹2,30,400 (2 lots = 2,400 shares) |
| Minimum Investment (HNI) | ₹3,45,600 (3 lots = 3,600 shares) |
| Issue Size | ₹25.63 crore |
| Fresh Issue | 26,70,000 shares (₹25.63 crore) |
| Offer For Sale (OFS) | Nil |
Note: The entire IPO is a fresh issue — no offer-for-sale component. All proceeds go directly to the company.
Issue Break-up
| Category | Allocation |
| Qualified Institutional Buyers (QIB) | ~50% |
| Non-Institutional Investors (NII/HNI) | ~15% |
| Retail Individual Investors (RII) | ~35% |
| Market Maker | 1,34,400 shares (Reserved) |
OFS / Selling Shareholders
There is no Offer For Sale (OFS) in this IPO. The issue is a 100% fresh issue with no offer-for-sale component, meaning the full proceeds go directly to the company.
Objects of the Issue (Fund Utilization)
The proceeds will primarily be utilised for working capital requirements, along with general corporate purposes and issue-related expenses. Additionally, the capital will enable the company to invest in new machinery and expand production capacity, particularly in segments where existing machinery currently limits output.
- Working capital requirements — primary allocation
- Purchase of new machinery and capacity expansion
- General corporate purposes — remaining proceeds
Lead Managers & Registrar
- Book Running Lead Manager: Interactive Financial Services Limited
- Registrar to the Issue: Bigshare Services Pvt. Ltd.
- Market Maker: To be announced
Promoters & Management
The company is promoted by Mr. Hardik Gotawala, Mr. Abhishek Gotawala, and Mr. Nilesh Gotawala. Mr. Hardik Gotawala serves as the Managing Director of the company. The promoter family has been in the textile business for multiple generations, bringing deep domain expertise and established trade relationships across domestic and international markets.
Company Details
Harikanta Overseas is a Surat-based textile manufacturer engaged in the production and export of synthetic and blended fabrics used primarily in women’s wear, especially sarees, along with fabrics for kurtas and garments. Ikat fabrics remain its flagship product, contributing over 73% of FY25 revenue. The company operates a manufacturing facility spread across 953.93 sq. mtrs. in Surat, Gujarat, equipped with jacquard rapier looms, rapier machines, rolling machines, and wrapping machines. Following the transfer of machinery from promoter group entities in September 2024, the company significantly expanded its manufacturing capabilities and diversified its product range.
Sectors Served:
- Women’s Ethnic Wear (Sarees, Dress Materials, Kurtas)
- Men’s Kurtas & Garments
- Export Markets — Cambodia, Thailand, Bahrain, Singapore
Key Products:
- Ikat Fabrics (flagship — 73%+ of FY25 revenue)
- Polyester Garment Fabrics
- Saree Fabrics
- Dhupion Fabrics
- Poly Linen
- Natural Fibre Fabrics
Key Capabilities:
- Flexible production capability, customised textile solutions, and quality-oriented fabric manufacturing.
- In-house jacquard rapier looms and rapier machines for high-quality weaving
- Strong export relationships with buyers in Southeast Asia and Middle East
Manufacturing Facility:
- Sai Ram Industrial Estate-2, Bamroli, Surat, Gujarat — 953.93 sq. mtrs.
Export Markets:
- Cambodia is the largest overseas market, accounting for approximately 40% of FY25 revenue, followed by Thailand, Bahrain, and Singapore.
Financial Snapshot
| Period | Revenue (₹ Cr) | PAT (₹ Cr) | PAT Margin |
| FY25 | ₹35.50 | ₹4.47 | ~12.6% |
Key Financial Metrics
- PAT margin of 19.5% and EBITDA margin of nearly 28% for the eight months ending November 2025 — strong recent performance, though FY23 and FY24 numbers were significantly weaker.
- Post-IPO P/E: ~12.4x (based on FY25 earnings)
- Export-heavy revenue model with ~64% export revenue provides dollar-denominated earnings that partially hedge against rupee depreciation.
Company Strengths
- Strong export orientation with Cambodia as the anchor overseas market and growing presence in Southeast Asia and Middle East — providing geographic revenue diversification.
- Operates in the synthetic textile and ethnic wear fabric segment where demand continues to remain strong due to growth in fashion retail, wedding wear, and organised textile distribution channels.
- Ikat fabric specialisation gives a product niche in a competitive market — flagship product contributing 73%+ of revenue
- Multi-generational promoter family expertise in textile manufacturing with established buyer relationships
- Entire IPO is a fresh issue — no promoter exit; all capital deployed into business growth
- Post-IPO expansion roadmap includes entry into new markets such as Vietnam, Laos, and South Africa, backward integration to manufacture certain raw materials in-house, and plans to double production capacity.
Key Risks & Challenges
- Lackluster financial performance in FY23 and FY24 — the sharp jump in profits from FY25 onwards raises concerns about sustainability, as the company operates in a highly competitive and fragmented segment.
- Commodity input risk — polyester and synthetic fiber prices are crude oil-linked, creating real-time raw material cost pressure.
- Fashion cycle risk — ethnic wear demand is seasonal and influenced by wedding calendars and regional festivities, making revenues potentially lumpy.
- High export concentration — Cambodia alone accounts for ~40% of revenue; any trade disruption or demand slowdown in this single market poses a significant risk
- Lead manager (merchant banker) has a poor track record in managing SME IPOs — a yellow flag for issue quality and post-listing support.
- Small manufacturing footprint (~954 sq. mtrs.) limits production scalability without significant additional capex
Disclaimer:
This document is for informational purposes only and should not be considered as investment advice. Investors should read the Red Herring Prospectus (RHP) carefully and consult a financial advisor before investing in any IPO. Market investments are subject to risk.
