Silky Overseas Lists at 6% Premium Despite Strong Subscription Buzz

The home textiles manufacturer, Silky Overseas Limited, made a lukewarm debut on the NSE SME platform on July 7, 2025. After closing its IPO bidding between June 30 - July 2, 2025, the company commenced trading with a modest 6.21% premium to its issue price, reflecting measured investor sentiment despite exceptional subscription levels in the textile manufacturing sector. 

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Silky Overseas IPO Listing Details

Silky Overseas Limited launched its IPO at ₹161 per share with minimum investment of 800 shares costing ₹1,28,800. The IPO received phenomenal response with subscription of 169.93 times - NII segment leading at remarkable 430.21 times, retail at 119.34 times, and QIB at 62.99 times, demonstrating overwhelming investor enthusiasm across categories.

Listing Price: The Silky Overseas share price opened at ₹171 on NSE SME on July 7, 2025, representing a premium of 6.21% from the issue price of ₹161, delivering modest gains despite exceptional subscription response.

First-Day Trading Performance Outlook

Silky Overseas IPO experienced modest debut performance with limited premium despite extraordinary subscription levels, reflecting market caution about textile sector valuations and sustainability concerns. The company, incorporated in 2016, specialises in home textiles including mink blankets, bed sheets, and comforters under the Rian Décor brand, operating integrated manufacturing facilities covering knitting, dyeing, processing, printing, and packaging with 135 employees and export operations to Middle East markets.

Utilisation of IPO Proceeds

• Storage Facility: ₹4.30 crore for setting up additional storage facility to enhance inventory management and operational capabilities
• Debt Repayment: ₹3.00 crore for repayment or prepayment of certain debt facilities to improve capital structure
• Working Capital: ₹12.00 crore for working capital requirements to support business operations and growth initiatives
• General Corporate Purposes: Remaining funds for strategic initiatives and operational requirements

Growth Drivers and Challenges

Growth Drivers:

• Integrated Manufacturing: Complete production lifecycle capabilities from knitting to packaging offering end-to-end manufacturing setup and operational efficiency
• Brand Portfolio: Established Rian Décor brand specialising in bedding essentials including mink blankets, bed sheets, and comforters serving domestic and export markets
• Export Presence: International operations extending to Middle East regions providing diversified revenue streams and growth opportunities
• Strong Financial Performance: Revenue growth with improving profitability trajectory and strong ROE of 36.56% demonstrating operational efficiency

Challenges:
 

• Modest Listing Performance: 6.21% premium despite 169.93 times subscription indicates market concerns about valuation sustainability and growth prospects
• Analyst Concerns: Reviewer highlights sudden boost in bottom lines from FY24 raising sustainability questions and recommending cautious approach
• High Debt Levels: Debt-to-equity ratio of 1.70 indicating leveraged operations requiring careful financial management and debt reduction strategies
• Small Scale Operations: Limited post-IPO equity capital suggesting longer gestation period for mainboard migration and scale expansion
   

Financial Performance of Silky Overseas IPO

• Revenue: ₹105.35 crore for 10M FY25, showing strong growth from ₹70.26 crore in FY24, reflecting business expansion and market penetration
• Net Profit: ₹9.17 crore in 10M FY25, demonstrating impressive growth from ₹5.53 crore in FY24, though sudden improvement patterns raise sustainability questions
• Financial Metrics: Strong ROE of 36.56%, healthy ROCE of 39.54%, concerning debt-to-equity of 1.70, modest PAT margin of 7.94%, and EBITDA margin of 15.80%

Silky Overseas' modest listing performance with 6.21% premium despite exceptional subscription response reflects cautious market sentiment towards textile manufacturers with recent financial surge patterns.