Kusumgar IPO crosses 12x subscription on Day 2, NII category leads at 36x

The initial public offering of Kusumgar Ltd., a Gujarat-based engineered fabrics manufacturer, had achieved an overall subscription of 12.85 times near the closing on Thursday, the second of three bidding days.

The Non-Institutional Investor (NII) category was the standout performer, subscribed 36.10 times against shares reserved for the segment. Within NIIs, high-value bidders applying for amounts above ₹10 lakh subscribed 36.68 times, while those in the Rs 2–10 lakh bracket came in at 34.94 times. Retail Individual Investors (RIIs) subscribed 9.38 times, while the Qualified Institutional Buyer (QIB) category stood at 1.75 times, a figure that typically sees significant acceleration on the final day. The employee reservation portion was subscribed 3.83 times.

Total bids received stood at 14,73,48,635 shares against 1,14,68,094 shares on offer across categories.

The IPO, priced at ₹398–419 per share, is entirely an Offer for Sale of ₹650 crore, with promoters Siddharth Yogesh Kusumgar, Sapna Siddharth Kusumgar, and Siddharth Yogesh Kusumgar HUF offloading shares. The issue opened on July 8 and closes on July 10, 2026.

SBI Securities recommended subscribing for the long term, citing high entry barriers, strong technical capabilities in engineered fabrics, and co-development partnerships with global clients. Analysts noted the stock is valued at a FY26 P/E of 44.8x at the upper price band, higher than peers, but argued this is justified given superior EBITDA margins of 27.1 per cent and growth prospects, including a boost from India’s free trade agreements.

Key risks flagged by SBI Securities include a sharp working capital cycle expansion from 136 days in FY25 to 343 days in FY26, negative free cash flows, and customer concentration, with the top 10 clients accounting for nearly 60 per cent of FY26 revenue.