Madhur Knit Crafts Limited has come to the market with a ₹53.27 crore SME initial public offer. The issue opened on August 24, 2026, and will close on August 27, 2026. The price band is ₹95 to ₹100 per share. The issue has a lot size of 1,200 shares. At the upper price of ₹100, one lot costs ₹1.20 lakh. The proposed listing date is September 1, 2026, on the NSE SME platform. The basis of allotment is expected on August 28.
This review uses the latest available subscription data, company financial figures, IPO structure and public research information. It is an analytical review, not a personal investment recommendation. Subscription data can change during the trading day, and grey market data is unofficial. Investors should also read the offer documents and consider their own risk capacity before making a decision.
Latest Subscription Position
The most useful current figure is the Day 3 data available on August 26. At about 10:34 AM, the IPO had a total subscription of 0.48 times. The QIB portion stood at 1.01 times, retail stood at 0.66 times, and the NII portion stood at 0.25 times. The issue remains open until August 27.
This data gives a mixed picture. QIB demand has crossed the one-time mark, which means the shares reserved for that category have received bids equal to or above the available quantity. Retail demand has also improved from the earlier level. However, the NII category remains below one time, and the full issue has not yet reached one time.
The Day 2 closing data gives a useful comparison. At the end of August 25, QIB demand stood at 1.01 times, NII demand stood at 0.23 times, retail demand stood at 0.55 times and the total issue stood at 0.42 times.
| Subscription category | Day 2 close | Day 3 latest |
|---|---|---|
| QIB | 1.01x | 1.01x |
| NII | 0.23x | 0.25x |
| Retail | 0.55x | 0.66x |
| Total | 0.42x | 0.48x |
The main point is that demand has improved, but it has not yet become broad-based. QIB demand is the strongest part of the book. Retail demand has also shown a clear rise. NII demand is still the weaker part.
The Day 2 live update also showed a different intraday figure of about 0.47 times at one point. This is not unusual because IPO subscription numbers can change through the day. The Day 2 closing figure of 0.42 times is the more useful number for a comparison with the Day 3 data.
What the IPO Offers
The company is raising ₹53.27 crore through a fresh issue. The shares offered to the public total 5,326,800 shares. There is no offer-for-sale component in the issue. This means the main IPO proceeds go to the company rather than to existing shareholders selling their shares.
The price band is ₹95 to ₹100. The face value is ₹10 per share. The minimum lot is 1,200 shares. At ₹100, the minimum application value is therefore ₹1.20 lakh. Moneycontrol also reports a maximum retail application of 2,400 shares, equal to ₹2.40 lakh at the upper price.
| IPO detail | Information |
| Issue size | ₹53.27 crore |
| Issue type | Fresh issue |
| Price band | ₹95–₹100 |
| Face value | ₹10 |
| Lot size | 1,200 shares |
| Minimum value at ₹100 | ₹1.20 lakh |
| Opening date | August 24, 2026 |
| Closing date | August 27, 2026 |
| Allotment | August 28, 2026 |
| Listing | September 1, 2026 |
| Platform | NSE SME |
The high minimum application is important. An investor who buys one lot has ₹1.20 lakh at risk at the upper price. SME shares can also have lower liquidity than mainboard shares. Therefore, a good business result does not always mean that an investor can sell the shares quickly at a preferred price.
Use of IPO Proceeds
One of the stronger parts of the IPO structure is the planned use of funds. The company plans to use ₹20.85 crore for repayment or prepayment of borrowings. It plans to use ₹15.92 crore for working capital. Another ₹3.68 crore is for the purchase of solar panels. About ₹12.82 crore is for general corporate purposes.
| Proposed use | Amount | Share of total issue |
| Debt repayment or prepayment | ₹20.85 crore | 39.14% |
| Working capital | ₹15.92 crore | 29.89% |
| Solar panels | ₹3.68 crore | 6.91% |
| General corporate purposes | ₹12.82 crore | 24.06% |
| Total | ₹53.27 crore | 100% |
The debt repayment part deserves attention. Nearly 39% of the issue proceeds are meant for debt reduction. This can reduce the company’s interest burden and may help its balance sheet. However, it would be incorrect to assume that the company will become low-debt after the IPO. Its borrowings were still substantial before the issue.
The solar panel plan may also help reduce power costs over time, but the exact financial benefit will depend on the actual cost savings and use of the new capacity. Such benefits should be treated as future possibilities rather than guaranteed gains.
Financial Performance
The financial record shows a large improvement in revenue and profit over the reported periods. Restated figures show revenue of ₹108.41 crore in FY24 and ₹171.76 crore in FY25. The February 2026 interim figure is ₹194.79 crore. PAT rose from ₹1.70 crore in FY24 to ₹11.03 crore in FY25 and ₹12.35 crore in the February 2026 period.
| Financial measure | FY24 | FY25 | Feb 2026 interim |
| Revenue | ₹108.41 Cr | ₹171.76 Cr | ₹194.79 Cr |
| EBITDA | ₹8.04 Cr | ₹23.28 Cr | ₹25.67 Cr |
| PAT | ₹1.70 Cr | ₹11.03 Cr | ₹12.35 Cr |
| Net worth | ₹16.24 Cr | ₹29.49 Cr | ₹43.61 Cr |
| Borrowings | ₹57.79 Cr | ₹67.20 Cr | ₹73.54 Cr |
| EPS | — | — | ₹8.23 |
The growth in profit is notable. PAT rose more than six times from FY24 to the February 2026 period. Revenue also rose strongly. EBITDA increased from ₹8.04 crore to ₹25.67 crore over the same reported periods.
However, there is an important point on the dates. The ₹194.79 crore revenue and ₹12.35 crore PAT figure relates to the interim period reported in the offer document and should not be treated as a full 12-month FY26 result without checking the exact period. One public data source labels this period as February 2026 interim data.
That distinction matters because annual figures and partial-period figures are not always directly comparable.
Debt Position
Debt is one of the main areas that deserves careful attention. Borrowings rose from ₹57.79 crore in FY24 to ₹67.20 crore in FY25 and then to ₹73.54 crore in the reported February 2026 period.
This creates a mixed picture. The company has produced much higher profit, but debt has also increased. The IPO’s planned ₹20.85 crore debt repayment is therefore relevant.
The reported debt-to-equity ratio is about 1.69 times. Reported ROE is about 28.33%, while ROCE is about 31.11%.
These return ratios look strong on the surface. At the same time, high returns can partly reflect the use of debt. Investors should therefore view ROE and ROCE along with the debt level rather than in isolation.
Cash flow is another area to watch. Public IPO research notes a history of negative operating cash flow in earlier periods, while the latest reported period shows improvement. The direction is positive, but a longer record of cash generation would provide more comfort.
Valuation
At the upper price of ₹100, the reported EPS is about ₹8.23. One offer-document-based analysis places the pre-issue P/E at about 12.15 times and the post-issue P/E at about 13.91 times. The reported ROE is 28.33%, and ROCE is 31.11%.
| Valuation measure | Reported figure |
| Upper issue price | ₹100 |
| EPS | ₹8.23 |
| Pre-issue P/E | 12.15x |
| Post-issue P/E | 13.91x |
| ROE | 28.33% |
| ROCE | 31.11% |
| Debt/Equity | 1.69x |
The valuation does not appear extremely high on the reported P/E. That is a positive point. But P/E alone does not tell the full story. Debt, cash flow, business concentration and SME liquidity also matter.
A valuation near 14 times post-issue earnings can appear reasonable if profit growth remains strong. It can look less attractive if profit growth slows or cash generation remains weak. For that reason, the valuation should be viewed as reasonable rather than automatically cheap.
Business Profile
Madhur Knit Crafts is a textile manufacturer based in Ludhiana, Punjab. The company has moved toward a vertically integrated yarn-to-cloth model. Its product range includes knitted fabrics, blankets, anti-pilling fabrics, sherpa fabrics and garments.
Vertical integration can offer better control over production, quality and supply. The company’s location in Ludhiana also gives it access to an established textile ecosystem.
The company also has an order-based and demand-driven production model, according to IPO information. That can help align production with demand, although the benefit depends on the quality and stability of customer orders.
Key Business Risks
The first major risk is geographic concentration. A high share of revenue comes from Punjab. This creates exposure to local economic conditions, regional demand and changes in the local operating environment.
The second risk is customer concentration. The company depends on a relatively small number of customers for a meaningful part of its revenue. The loss or reduction of business from a major customer could affect sales and profit.
The third risk is supplier concentration. A substantial part of raw material supply comes from a limited number of suppliers. A disruption in supply or a sharp change in raw material prices could affect margins.
The fourth risk is seasonality. A major part of the product mix relates to winter wear and winter textile demand. This can create uneven demand across the year.
The fifth risk is cash flow. Profit growth is useful only when it can translate into cash over time. The earlier negative cash flow record means this point deserves close attention.
The sixth risk is SME market liquidity. The minimum application is ₹1.20 lakh at the upper band, and SME stocks can have lower trading liquidity than mainboard stocks. Price movement can therefore be sharp, both upward and downward.
QIB Demand Versus Retail Demand
The current subscription pattern is worth studying. QIB demand reached 1.01 times early, while retail demand rose to 0.66 times by the latest Day 3 update. NII demand remained at only 0.25 times.
This does not prove that the IPO will list at a profit. It only shows the level of demand in each category at the stated time.
QIB participation is a positive market signal because this category usually contains institutional investors. Still, one should not treat QIB subscription as a guarantee of future share performance.
The weak NII response is also important. The NII category often includes investors with larger application sizes. Its low subscription level suggests that demand among this group has not yet matched the QIB response.
Grey Market Premium
Grey market premium data should be treated with caution. One tracker reported a GMP of ₹16 on August 25, which would imply a theoretical price of about ₹116 against the ₹100 upper issue price.
This is not an official exchange price. Grey market trading is unofficial and unregulated. It can change quickly and may not translate into the actual listing price.
For this reason, GMP should not be treated as a reliable forecast. The actual listing price will depend on market demand, company fundamentals, overall market conditions and the trading environment after listing.
Overall Assessment
Madhur Knit Crafts presents a mixed but credible IPO case. The positive side has several strong points. Revenue and PAT have grown sharply. The reported ROE and ROCE are high. The valuation does not appear excessive on the reported P/E. QIB demand has reached 1.01 times. The company also plans to use ₹20.85 crore of IPO proceeds for debt repayment.
The negative side is also clear. Borrowings have risen. The debt-to-equity ratio is about 1.69 times. Earlier cash flow has been a concern. Revenue has high geographic concentration. Customer and supplier concentration create additional risk. The business has seasonal exposure. The SME structure also creates a higher liquidity risk.
The subscription data does not yet show a broad demand surge. As of the latest Day 3 update, the total subscription is 0.48 times. QIB demand is 1.01 times, retail is 0.66 times and NII is 0.25 times.
Final View
Based on the available data, Madhur Knit Crafts can be described as a selective and higher-risk SME IPO, rather than a clear low-risk opportunity.
The company has a much better profit record than it had two years earlier. Its reported returns are strong, and the IPO valuation is not obviously stretched. The debt repayment plan also gives the issue a practical purpose.
At the same time, the rise in borrowings, past cash flow concerns, business concentration and SME liquidity risk prevent a simple bullish conclusion.
The most important new information will come from the final subscription numbers on August 27. A strong rise in NII and retail demand, along with total subscription above one time, would provide a more supportive demand signal. Weak final demand would suggest that institutional interest alone has not created broad market confidence.
Therefore, the most balanced conclusion is “Selective Apply / Moderate to High Risk,” subject to the investor’s own financial position and risk tolerance. This view is based on publicly available information and should not be read as a promise of listing gains, future returns or capital protection.
For a short-term investor, the main question is demand and post-listing liquidity. For a longer-term investor, the more important questions are whether profit growth remains strong, whether operating cash flow improves, whether debt falls after the IPO and whether the company can reduce its dependence on a limited region and customer base.
The IPO has genuine strengths, but those strengths come with clear risks. The data supports a careful assessment rather than a blind subscription decision.
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