Panchatv Bharat
A distinct read of SME-specific danger (liquidity, concentration, forensic flags) — separate from the FinMinutes Score. Higher band = more caution warranted.
- Collapsing Operating Cash Flow (CFO turned -Rs. 10.85 crore in FY26) alongside rising PAT of Rs. 4.03 crore.
- Promoter WACA of Rs. 11.11 per share vs IPO issue price of Rs. 140.00 (92% discount achieved via pre-IPO bonus allotment).
- Valuation of 14.23x P/E set at a 57% premium over sole mainboard peer Anjani Synthetics Limited (9.05x P/E).
- Thin corporate workforce of only 9 employees driving Rs. 56.85 crore in revenue, primarily via fabric trading (76.23%).
- ROC secretarial non-compliances, penalty adjudication via Form GNL-1, and promoter GST tax proceedings.
Educational risk signal grounded in the filing — not a buy/sell call.
First time with SME IPOs? Read the SME IPO guide and the risks before applying.
FinMinutes Deep Business Model & Edge
Panchatv Bharat Limited is engaged in the manufacturing and wholesale trading/distribution of finished denim fabrics under its own brand name 'NJD' through third-party arrangements and leased loom machineries.
What this company actually does — full breakdown ▾
Panchatv Bharat Limited operates in the textile and garment industry, specializing in the manufacturing and distribution of finished denim fabrics under its in-house brand name 'NJD'. The company was originally incorporated in March 2024 to acquire and consolidate three proprietorship firms owned by its promoters (M/s SG Trader, M/s SR Fabrics, and M/s Neelmadhav Textiles). It manufactures denim fabrics primarily through asset-light third-party job work arrangements with partner facilities located in Narol and Piplaj, Ahmedabad, supplemented by 10 leased loom machineries situated in Daskroi, Ahmedabad (commenced July 2025). The company also buys finished denim fabrics from third-party distributors and suppliers. Products are sold in bulk to garment manufacturers, distributors, dealers, and wholesalers across multiple Indian states, with Delhi accounting for 67.59% of FY26 revenue from operations. In FY26, traded denim fabrics accounted for 76.23% (Rs. 43.34 crore) of revenue while manufactured denim fabrics accounted for 23.77% (Rs. 13.52 crore).
Asset-light business model enabling operational flexibility and low capex, established customer base of over 89 active distributors, in-house brand 'NJD', and experienced promoter leadership with over 30 years in textile trading.
The Offer
Follow the Money — Use of Proceeds
- Funding of capital expenditure towards purchase of property at Delhi and renovation, modernization and fit-out thereof — ₹6.00 cr
- Funding working capital requirements of our Company — ₹11.50 cr
- General Corporate Purposes — ₹3.67 cr
Valuation at the Offer Price
These are the multiples the issuer is required to disclose under “Basis for the Offer Price”. The peer group is the one the filing itself names. A premium is not the same thing as expensive and a discount is not the same thing as cheap — the peer table and the reasons sit further down this page.
FinMinutes IPO Score — How It's Built
Transparent, deterministic, computed from the filing — not an opinion. Open any component below to see exactly what it measures and what it is worth. Components with no disclosed input are dropped from the weighting entirely rather than held at an invented neutral, because a constant inside a weighted average is not neutral — it quietly drags every score toward the middle. Weighted across 5 live components.
88% of the designed weighting had real data behind it on this issue. Not yet scored here: Filing Integrity. A lower coverage figure does not mean a worse company — it means we are standing behind less of the picture, and you should read the findings below rather than the headline number.
How this is measured12%
Whether fresh capital actually enters the business. A predominantly offer-for-sale issue is marked down ONLY when the financials are weak. A profitable, cash-rich company selling down is treated as neutral, not penalised, because it does not need the money.
How this is measured32%
Driven by the models battery run on the filing's own restated numbers: the Piotroski fundamental tests (scored out of those we could actually run), the Altman Z-double-prime solvency zone, and the direction of profit across the disclosed period. It is not a single yes/no on last year's profit.
How this is measured10%
The post-issue earnings multiple against the peer median disclosed in the filing. A discount to the median scores well and a premium scores badly. When the filing does not disclose comparable peer multiples, this component is dropped from the weighting rather than held at a made-up neutral.
How this is measured6%
A proxy for syndicate strength, based today only on how many lead managers are on the issue: 75 where three or more banks are involved, 60 otherwise. We have not built a bank-by-bank track record, so treat this as a rough signal. When the filing does not disclose the syndicate, this component is dropped from the weighting rather than guessed.
How this is measured28%
Starts at 100 and loses points for every material finding: 12 for a flagged finding, 4 for a noted one. Two kinds feed it. DERIVED findings are computed from the filed numbers against stated thresholds — operating cash negative while profit is positive, related-party revenue above 15% of total, revenue rising while profit falls, goodwill above 30% of net worth, receivables growing more than 1.3x faster than sales, cash below half of short-term debt. Those are reproducible: the same filing gives the same answer every time, and the rule is printed beside the finding. READ findings come from the forensic sweep of the notes. Contingent liabilities, related-party intensity, customer concentration, litigation, auditor qualifications, statutory dues, promoter funding. Findings that record the ABSENCE of a problem — no litigation pending, an unmodified audit opinion — deduct nothing. This is the component our forensic read drives directly, and it moves most between companies.
3-Year Financial & Growth Trend
| Metric | FY26 | FY25 | FY24 |
|---|---|---|---|
| Revenue (₹ Cr) | 56.8511 | 48.9933 | 39.3125 |
| Net Profit (₹ Cr) | 4.031 | 2.8281 | 2.0211 |
| PAT Margin | 7.09% | 5.77% | 5.14% |
Market Context
NOT part of the FinMinutes ScoreThe Score above is what the filing says. Everything in this box is what the crowd says. We keep them apart on purpose — every other site blends the two and calls the result a rating. Demand is real information, but it is information about the market, not about the company, and it changes by the hour while the company does not.
Demand and our read of the filing are broadly in the same territory.
Subscription is low early in a book and high at the end, because most bids arrive in the final hours. A number read on day one says more about the clock than the company — which is precisely why it is not in the Score. GMP is unofficial, unregulated, and easily moved. Neither is a recommendation.
Why the numbers moved, in management’s own words
Taken from the Management’s Discussion and Analysis section of the filing. A number tells you what happened; this is the company’s explanation of why, and whether it calls the cause temporary or structural.
| Metric | Move | Management's stated reason | Type |
|---|---|---|---|
| Revenue from Operations (FY26 vs FY25) | ↑ 16.0% | Revenue increased due to higher sales volume of denim fabrics driven by increased demand from existing distributors in Uttar Pradesh and Gujarat. | Structural |
| Revenue from Operations (FY25 vs FY24) | ↑ 24.6% | Revenue increased due to higher sales volume resulting from new customer additions and increased orders from existing distributors in Delhi and Haryana. | Structural |
| Cost of Raw Materials Consumed (FY26 vs FY25) | ↓ 17.1% | Cost of raw materials consumed decreased primarily due to lower purchases of raw material for fabric production. | Structural |
| Cost of Raw Materials Consumed (FY25 vs FY24) | ↑ 20.5% | Cost of raw materials consumed increased due to higher consumption and purchase of raw materials to support increased fabric production volumes. | Structural |
| Purchases of Stock-in-Trade (FY26 vs FY25) | ↑ 26.6% | Purchases of stock-in-trade increased due to expansion in wholesale trading of finished denim fabrics to meet growing market demand. | Structural |
| Purchases of Stock-in-Trade (FY25 vs FY24) | ↑ 16.6% | Purchases of stock-in-trade increased to support higher sales volumes of traded denim fabrics across regional markets. | Structural |
| Employee Benefit Expenses (FY26 vs FY25) | ↑ 15.1% | Employee benefit expenses rose due to an increase in salaries and wages by 23.47% and staff welfare expenses by 45.21%. | Structural |
| Employee Benefit Expenses (FY25 vs FY24) | ↑ 220.3% | Employee benefit expenses increased sharply due to an 89.76% rise in salaries and wages and the inclusion of director remuneration of Rs. 24.00 Lakhs (which was nil in FY24). | Structural |
| Finance Costs (FY26 vs FY25) | ↑ 33.5% | Finance costs increased due to a higher proportion and volume of short-term bank borrowings utilized to fund working capital requirements. | Structural |
| Finance Costs (FY25 vs FY24) | ↑ 80.9% | Finance costs increased primarily due to higher short-term borrowings taken to meet operational requirements. | Structural |
| Depreciation and Amortization Expense (FY26 vs FY25) | ↓ 50.2% | Depreciation decreased significantly due to lower depreciation charged on motor vehicles compared to the previous fiscal year. | One-off |
| Other Expenses (FY25 vs FY24) | ↑ 56.7% | Other expenses increased due to higher office rent, vehicle maintenance, audit fees, late fees, interest penalties, and software/website expenses. | Structural |
| Profit After Tax (FY26 vs FY25) | ↑ 42.5% | Profit after tax increased primarily due to higher revenue from operations and improved operating margins. | Structural |
| Profit After Tax (FY25 vs FY24) | ↑ 39.9% | Profit after tax increased due to top-line growth driven by expanded wholesale distribution. | Structural |
| Operating Cash Flow (FY26 vs FY25) | ↓ 1,610.9% | Operating cash flow turned negative at -Rs. 1,085.12 Lakhs due to working capital decisions, including intentional inventory buffer stocking (holding period increased to 102 days) and faster settlement of trade payables to MSME suppliers. | One-off |
| Inventories (FY26 vs FY25) | ↑ 57.7% | Inventories increased as the company intentionally built up buffer stock of raw materials and finished goods to hedge against expected price increases from ongoing war and market uncertainties. | One-off |
| Inventories (FY25 vs FY24) | ↑ 38.9% | Inventories increased due to higher procurement of raw materials and finished fabrics to support sales volume growth and maintain buffer stock. | Structural |
| Trade Receivables (FY25 vs FY24) | ↑ 91.3% | Trade receivables increased due to higher sales volumes to wholesale and bulk customers under standard industry credit terms. | Structural |
| Borrowings (FY26 vs FY25) | ↑ 83.2% | Total borrowings increased due to higher short-term bank borrowings utilized to finance inventory buildup and working capital requirements. | Structural |
Headwinds
- Raw material price volatility in cotton yarn and finished fabrics sector
Fluctuations in cotton and fabric prices directly affect procurement costs and can impact operating margins if cost increases cannot be fully passed on to buyers. - Geographic revenue concentration in Delhi (67.59% of FY26 sales) company
High concentration in Delhi exposes the company to localized economic shifts, competitive dynamics, and regional demand disruptions. - Dependence on third-party job workers and leased loom machinery company temporary
Lack of owned manufacturing facilities makes the company vulnerable to operational disruptions, quality inconsistencies, or contract non-renewals by third-party facilities or lessors.
Tailwinds
- Government textile sector policies including PM MITRA Parks and Cotton Mission macro
Central policy initiatives, mega textile parks, and PLI schemes enhance domestic manufacturing infrastructure and long-term industry competitiveness. - Strategic expansion into North Indian textile hubs (Delhi, UP, Rajasthan) company
Expanding distributor networks and capturing market share in major textile trading hubs provides a clear path for sustained volume growth.
| Facility | Period | Utilisation |
|---|---|---|
| Leased Loom Machineries (10 Air Jet Looms, Daskroi, Ahmedabad) | FY26 | 84.0% |
Movements the filing does not explain
- Trade Payables Drop in FY26 FY26 vs FY25 — Trade payables dropped 53.95% from Rs. 9.27 crore to Rs. 4.27 crore despite a 26.58% increase in stock-in-trade purchases (Rs. 44.17 crore); MD&A notes faster payment to MSME vendors before year-end but does not detail supplier credit term renegotiations.
- Capital Advance Reclassification in Short-Term Loans & Advances FY26 — Short-term loans and advances expanded from Rs. 0.29 crore to Rs. 5.06 crore due to reclassifying Rs. 4.51 crore of property capital advances from non-current to current, without providing MD&A disclosure on the underlying property acquisition terms.
A material movement that management does not address is not a finding on its own. It is a question the filing leaves open, and it is recorded here as one.
Issue Timeline
Dates as carried by the exchange feed. Allotment, refund and credit dates move more often than the open and close dates do.
- Refunds initiated2026-09-17
- Pre Application Start2026-09-09
- Bidding Start2026-09-10
- Bidding End2026-09-15
- Allotment Process Start2026-09-16
- Allotment Finalization2026-09-17
- Listing Day2026-09-18
- Mandate End2026-10-27
Applying, and Who Handles the Allotment
Check allotment status on the registrar’s own portal → We link the registrar directly rather than mirroring the form.
Deep Financials
Revenue, EBITDA and profit are what every listing site prints. Below are the full restated statements as disclosed, the ratios we compute from them, and a DuPont decomposition of the return on equity. A prospectus carries three years, not ten — that is the document’s ceiling, and within it we go as deep as it allows.
Income StatementThe profit and loss as filed, then what we derive from it — kept apart.
Statutory order, exactly as restated in the filing. Finance cost and depreciation sit inside Total Expenses under Ind AS, which is why they are listed among the expense lines here rather than below the total. The expense rows sum to the total. Rows the filing does not disclose separately are omitted rather than left blank.
| Income Statement — as filed (₹ Cr) | FY26 | FY25 | FY24 |
|---|---|---|---|
| Revenue from Operations | 56.85 | 48.99 | 39.31 |
| Other Income | 0.02 | 0.00 | 0.00 |
| Total Income | 56.87 | 48.99 | 39.31 |
| Cost of Materials Consumed | 8.66 | 10.45 | 8.67 |
| Purchases of Stock-in-Trade | 44.17 | 34.90 | 29.93 |
| Changes in Inventories | -3.70 | -1.97 | -2.97 |
| Employee Benefit Expense | 0.69 | 0.60 | 0.19 |
| Finance Cost | 1.17 | 0.88 | 0.49 |
| Depreciation & Amortisation | 0.03 | 0.05 | 0.05 |
| Other Expenses | 0.39 | 0.37 | 0.24 |
| Total Expenses | 51.41 | 45.27 | 36.58 |
| Profit Before Exceptional Items and Tax | 5.46 | 3.72 | 2.73 |
| Profit Before Tax | 5.46 | 3.72 | 2.73 |
| Tax Expense | 1.43 | 0.89 | 0.71 |
| Profit After Tax | 4.03 | 2.83 | 2.02 |
| EPS - Basic | 9.84 | 7.94 | 5.94 |
| EPS - Diluted | 9.84 | 7.94 | 5.94 |
Balance SheetWhat the company owns, owes, and is worth on paper.
| Balance Sheet (₹ Cr) | FY26 | FY25 | FY24 |
|---|---|---|---|
| Share Capital | 4.10 | 4.10 | 3.39 |
| Reserves & Surplus | 8.53 | 4.95 | 0.00 |
| Net Worth | 12.62 | 9.05 | 3.39 |
| Long-term Borrowings | 3.60 | 2.86 | 4.20 |
| Short-term Borrowings | 10.58 | 4.87 | 3.46 |
| Total Borrowings | 14.18 | 7.74 | 7.66 |
| Trade Payables | 4.27 | 9.27 | 4.96 |
| Current Liabilities | 17.56 | 15.25 | 9.29 |
| Total Liabilities | 33.78 | 27.16 | 16.88 |
| Property, Plant & Equipment | 0.13 | 0.16 | 0.20 |
| Capital Work in Progress | 0.00 | 0.00 | 0.00 |
| Investments | 0.00 | 0.00 | 0.00 |
| Inventories | 16.86 | 10.69 | 7.70 |
| Trade Receivables | 9.80 | 8.58 | 4.49 |
| Cash & Equivalents | 0.60 | 3.45 | 0.61 |
| Current Assets | 33.01 | 23.33 | 13.05 |
| Total Assets | 33.78 | 27.16 | 16.88 |
Cash FlowWhere the cash actually went. Often the most honest statement of the three.
| Cash Flow (₹ Cr) | FY26 | FY25 | FY24 |
|---|---|---|---|
| Net Cash from Operating Activities | -10.85 | 0.72 | -0.40 |
| Capital Expenditure | 0.00 | 0.00 | -0.18 |
| Net Cash from Investing Activities | 3.00 | 0.00 | -0.05 |
| Net Cash from Financing Activities | 5.01 | 2.12 | 0.40 |
| Net Change in Cash | -2.85 | 2.84 | -0.05 |
Ratio AnalysisProfitability, leverage, liquidity, efficiency and earnings quality — computed by us.
Every ratio below is computed by us from the line items the company disclosed — not copied from anywhere. The arithmetic is standard; the point is that somebody actually did it. Blank cells mean the filing did not disclose the inputs, and we would rather show a gap than invent a number.
| Ratio | FY26 | FY25 | FY24 |
|---|---|---|---|
| Profitability | |||
| EBITDA Margin (%) | 11.7 | 9.5 | 8.3 |
| EBIT Margin (%) | 11.7 | 9.4 | 8.2 |
| PAT Margin (%) | 7.1 | 5.8 | 5.1 |
| Return on Equity (%) | 31.9 | 31.3 | 59.6 |
| Return on Capital Employed (%) | 24.8 | 27.4 | 29.1 |
| Return on Assets (%) | 11.9 | 10.4 | 12 |
| Leverage | |||
| Debt / Equity (x) | 1.12 | 0.86 | 2.26 |
| Net Debt / EBITDA (x) | 2.04 | 0.92 | 2.16 |
| Interest Coverage (x) | 5.65 | 5.23 | 6.62 |
| Liquidity | |||
| Current Ratio (x) | 1.88 | 1.53 | 1.41 |
| Quick Ratio (x) | 0.92 | 0.83 | 0.58 |
| Efficiency | |||
| Asset Turnover (x) | 1.68 | 1.8 | 2.33 |
| Receivable Days | 63 | 64 | 42 |
| Inventory Days | 108 | 80 | 71 |
| Payable Days | 27 | 69 | 46 |
| Cash Conversion Cycle (days) | 144 | 75 | 67 |
| Quality of Earnings | |||
| Operating Cash Flow / PAT (x) | -2.69 | 0.25 | -0.2 |
| Accruals Ratio (%) | 44.1 | 7.8 | 14.4 |
| Capex / Depreciation (x) | 0.13 | 0.03 | 3.81 |
DuPont DecompositionWhy the return on equity is what it is: margin, efficiency, or leverage.
A headline return on equity tells you what. The DuPont decomposition tells you why — whether the return is earned through margin, through asset efficiency, or simply through leverage. Two companies can post an identical ROE for opposite reasons, and only one of them is safe.
| Component | FY26 | FY25 | FY24 |
|---|---|---|---|
| Net Margin (PAT / Revenue) | 7.1% | 5.8% | 5.1% |
| Asset Turnover (Revenue / Assets) | 1.68x | 1.8x | 2.33x |
| Equity Multiplier (Assets / Net Worth) | 2.68x | 3x | 4.98x |
| = Return on Equity | 31.9% | 31.3% | 59.6% |
| Tax Burden (PAT / PBT) | 0.74x | 0.76x | 0.74x |
| Interest Burden (PBT / EBIT) | 0.82x | 0.81x | 0.85x |
| Operating Margin (EBIT / Revenue) | 11.7% | 9.4% | 8.2% |
Computed from the disclosed statements. Where the filing omits an input, the row is left blank rather than estimated.
Quality of EarningsWhat the statements say when you read them against each other.
What the statements say once you read them against each other. These are observations, not verdicts — every one is arithmetic on the numbers the company itself disclosed, and each is stated so you can go and check it in the filing.
- In FY26 the company reported a profit of 4.03 cr while operating cash flow was NEGATIVE at -10.85 cr. Reported earnings did not convert into cash. This is the single divergence most worth understanding in any set of accounts, and the filing is the place to look for why.
- Receivable days rose from 42 in FY24 to 63 in FY26. The company is booking revenue faster than it is collecting it, which ties up cash and raises the question of who is not paying.
- Between FY24 and FY26 revenue grew 45% while profit grew 99%. Profit expanding at several times the rate of revenue is not automatically a concern — operating leverage does exactly this — but it is worth confirming from the filing whether the gap comes from genuine margin expansion or from one-off items.
Forensic ModelsBeneish, Altman and Piotroski — plus our own final-year check.
Beneish M-Score
M = -0.59An eight-variable model built to detect earnings manipulation, and built to run on exactly two consecutive years — which is what a prospectus gives us. It belongs here more than anywhere: a company about to list has the maximum possible incentive to have dressed up the very years it is about to show you. A score above −1.78 is the threshold at which the model says the accounts merit a closer look. It is a screening signal, not an accusation, and it was calibrated on listed companies elsewhere. Read the eight components, not just the total.
| Component | Value | What it captures |
|---|---|---|
| DSRI Days Sales in Receivables Index (Receivables_t / Sales_t) / (Receivables_t-1 / Sales_t-1) | 0.984 | Above 1 means receivables grew faster than sales. Revenue may be being recognised ahead of collection. |
| GMI Gross Margin Index GrossMargin_t-1 / GrossMargin_t | 0.928 | Above 1 means margins deteriorated. A firm with worsening prospects has more incentive to manipulate. |
| AQI Asset Quality Index AQ_t / AQ_t-1, where AQ = 1 - (CurrentAssets + PPE) / TotalAssets | 0.137 | Above 1 means a rising share of assets is soft (neither current nor fixed) — capitalised costs can hide here. |
| SGI Sales Growth Index Sales_t / Sales_t-1 | 1.16 | Growth is not manipulation. But high-growth firms face more pressure to keep the streak going. |
| DEPI Depreciation Index DepRate_t-1 / DepRate_t, where DepRate = Dep / (Dep + PPE) | 1.546 | Above 1 means assets are being depreciated more slowly — a quiet way to lift reported profit. |
| SGAI SG&A Index (SGA_t / Sales_t) / (SGA_t-1 / Sales_t-1), SGA proxied as employee cost + other expenses | 0.958 | A proxy, because filings rarely break out SG&A cleanly. Read it as a direction, not a precise figure. |
| LVGI Leverage Index Leverage_t / Leverage_t-1, where Leverage = (CurrentLiab + LongTermDebt) / TotalAssets | 0.939 | Above 1 means leverage rose. Debt covenants create pressure to hit numbers. |
| TATA Total Accruals to Total Assets (PAT - CashFromOperations) / TotalAssets | 0.4406 | The gap between reported profit and cash generated. The single heaviest term in the model — and the one that catches profit that never became cash. |
M = -0.59, above the −1.78 threshold. On this model the accounts merit closer reading. That is a prompt to go to the filing, not a conclusion about it.
Altman Z″-Score (emerging markets)
Z″ = 8.79 · SafeA distress-prediction model. We use the Z″ variant deliberately: the original Z was calibrated on American manufacturers and misleads badly on Indian services companies. Above 2.6 is the safe zone, 1.1 to 2.6 is grey, below 1.1 is the distress zone. Like every model of its kind it is a screen, not a prophecy.
| X1 — Working Capital / Total Assets | 0.458 |
| X2 — Retained Earnings / Total Assets | 0.253 |
| X3 — EBIT / Total Assets | 0.196 |
| X4 — Net Worth / Total Liabilities | 0.374 |
| Z″ = 3.25 + 6.56·X1 + 3.26·X2 + 6.72·X3 + 1.05·X4 | 8.79 |
Piotroski F-Score (adapted)
4 / 8Nine yes-or-no tests of fundamental strength — except we run eight. One of the original nine asks whether the company issued new shares, which is plainly absurd to ask of a company whose entire purpose at this moment is to issue shares. We drop that test and score out of eight, and we would rather tell you that than quietly fudge it.
- ✓Positive return on assets
- ✗Positive operating cash flow
- ✓Return on assets improving
- ✗Cash flow exceeds profit (quality of earnings)
- ✗Long-term leverage decreasing
- ✓Current ratio improving
- ✓Gross margin improving
- ✗Asset turnover improving
The Final-Year Check
oursNot from any textbook. The hockey stick in the last year before a filing is the oldest pattern in this business, and nobody publishes it. So we measure it: how the final disclosed year compares with the years behind it. Real acceleration looks exactly the same on the page as a flattering one — which is precisely why it is worth naming rather than assuming either way.
- Cash conversion fell sharply in the final year: operating cash flow was -2.69x profit in FY26, against 0.25x in FY25. Profit rose; the cash behind it did not follow at the same rate.
Ratios Nobody Prints
- Contingent liabilities / Net worth: 0.4%
Contingent liabilities of 0.05 cr against a net worth of 12.62 cr — 0.4% of what the company is worth on paper. These are obligations that sit off the balance sheet but could land on it. What they consist of matters as much as the size: a corporate guarantee to a subsidiary is a different animal from a disputed tax demand, and the filing says which. - Related-party revenue / Total revenue: 0%
0% of revenue in FY26 came from entities connected to the promoters. Revenue you sell to yourself is not the same as revenue you won in the market. - Cash / Short-term borrowings: 0.06x
Short-term borrowings of 10.58 cr against cash of 0.60 cr. Debt that must be refinanced within a year is only comfortable while lenders stay comfortable. - Promoter remuneration / PAT: 6%
Managerial remuneration to the promoter group was 0.24 cr against a profit of 4.03 cr. This is a legitimate cost — but it is also a route by which value leaves a company before it ever reaches a minority shareholder.
The Formula NotebookEvery number above, with the working shown. Check us.
Every number we publish, with the working shown. The formula, the same formula with this company’s actual figures put into it, the answer, and what it is for. Check us. That is the point.
PAT ÷ Net Worth4.03 ÷ 12.62What the company earned on the money shareholders have in it. The headline measure of return — and the one the DuPont section takes apart.
EBIT ÷ (Net Worth + Total Borrowings)6.64 ÷ (12.62 + 14.18) = 6.64 ÷ 26.80Return on ALL the capital in the business, borrowed as well as owned. Unlike ROE, it cannot be flattered by taking on debt.
EBITDA ÷ Revenue6.66 ÷ 56.85Operating profitability before the effects of debt, tax and depreciation. What the business earns from the act of trading.
Total Borrowings ÷ Net Worth14.18 ÷ 12.62How much the company has borrowed against what it owns. High is not automatically bad — ask whether the borrowing is being serviced comfortably.
EBIT ÷ Finance Cost6.64 ÷ 1.17How many times over operating profit covers the interest bill. Below about 2x, a meaningful share of what the business earns is going to lenders rather than owners.
(Trade Receivables ÷ Revenue) × 365(9.80 ÷ 56.85) × 365How long the company waits to be paid. Rising receivable days mean revenue is being booked faster than it is collected — which is where a great many accounting problems begin.
Inventory Days + Receivable Days − Payable Days108 + 63 − 27How long cash is tied up in the operating cycle before it comes back. The longer it is, the more working capital the business must fund.
Cash from Operations ÷ PAT-10.85 ÷ 4.03Did the profit turn into cash? Profit is an opinion; cash is a fact. When this sits well below 1x for long, the two are drifting apart, and the filing is where you find out why.
(PAT − Cash from Operations) ÷ Total Assets(4.03 − -10.85) ÷ 33.78 = 14.88 ÷ 33.78The share of reported profit that exists on paper rather than in the bank. It is also the heaviest single term in the Beneish model, for good reason.
Price × Post-issue Shares₹140.00 × 5,851,000 sharesWhat the whole company is being valued at, if the issue prices at the top of the band.
Market Cap + Total Borrowings − Cash81.91 + 14.18 − 0.60What it would actually cost to buy the whole business: you take on its debt and you get its cash. This is the number a buyer cares about, and it is the reason a P/E on its own can mislead.
Enterprise Value ÷ EBITDA95.49 ÷ 6.66The multiple that includes debt. Two companies on the same P/E — one debt-free, one heavily borrowed — are not the same investment, and only this number tells you so.
Market Cap ÷ PAT81.91 ÷ 4.03The familiar multiple. Useful, but blind to debt — read it alongside EV/EBITDA, never instead of it.
EBIT × (1 − tax rate) ÷ (Net Worth + Debt − Cash)NOPAT ÷ Invested CapitalWhat the business earns on the capital actually at work in it. We do not compare this to a cost of capital: that would need a beta, an unlisted company has none, and inventing one would be theatre.
P/E ÷ trailing PAT growth (%)20.32 ÷ 42.5%PEG was designed for FORWARD growth. This one uses TRAILING growth, because that is all a prospectus gives us — and the final year before an IPO is very often the best year the company will have for a while. A low PEG here may say more about the timing of the filing than about the price. We show it because it was asked for; we show the growth denominator beside it so it cannot mislead you quietly.
Workspace
The numbers are already loaded. Move the offer price and watch every multiple move with it. Set your own growth and margin and see what they imply two years out. These are your assumptions, not our forecast — we have no view on what this company will earn, and the moment we published one we would be doing something we are not registered to do. What we can do is put the arithmetic in front of you and get out of the way.
Price defaults to the top of the band. Margin defaults to what the company actually reported in FY26.
Projections are arithmetic on the inputs you typed. They are not a forecast, not a recommendation, and not a view on whether this offer is worth taking. Educational only.
Institutional Alpha: DRHP Deep Dive
Dressed Bride: Operating Cash Flow Collapses to -Rs. 10.85 Crore Behind PAT Growth
In the pre-IPO fiscal year (FY26), Panchatv Bharat reported a 42.53% increase in net profit to Rs. 4.0310 crore. However, Cash Flow from Operations (CFO) crashed to -Rs. 10.8512 crore (from +Rs. 0.7182 crore in FY25) as inventory expanded by 57.69% to Rs. 16.8586 crore (102 inventory days) and payables shrank. The company is using public IPO funds of Rs. 11.50 crore to refinance this working capital inventory lockup.
Source: p.21, 48, 51, 83Promoter Share Dance: 36.29 Lakh Bonus Shares Yield Rs. 11.11 WACA
In May 2024, promoters Sanjay Gupta & Sooraj Gupta were issued 3,629,500 bonus shares at Rs. 0.00 following a small preferential allotment, bringing their average cost of acquisition down to Rs. 11.11 per share. Offering shares to the public at Rs. 140.00 per share gives promoters a 12.6x markup on their entry valuation within 27 months.
Source: p.61, 62, 105Asset-Light Fabric Trader Demanding 57% P/E Premium Over Sole Mainboard Peer
Panchatv Bharat operates with just 9 employees, deriving 76.23% of its revenue from wholesale trading of third-party fabrics. Despite this asset-light trading profile and recent corporate incorporation in March 2024, the company asks a P/E multiple of 14.23x at the Rs. 140 issue price—a 57.2% premium over its sole listed peer Anjani Synthetics Limited (9.05x P/E).
Source: p.101, 102, 140, 142Shareholding, Syndicate & Leadership
Leadership & Skin in the Game
Leadership: Sanjay Gupta
Litigation: Indirect tax GST proceedings against Promoters: Show cause notice against Sanjay Gupta (M/s SR Fabrics) under Section 73 of CGST/DGST Act for FY18 involving Rs. 0.0270 crore (Rs. 2.70 lakhs); order against Sooraj Gupta (M/s SG Trader) under Section 74 of IGST/CGST/SGST Act for FY20 involving Rs. 0.0191 crore (Rs. 1.91 lakhs). Total tax proceedings: Rs. 0.0460 crore (Rs. 4.60 lakhs). Criminal or civil litigation: NIL.
Peers & Valuation
| Company | P/E | P/B | RoE | Margin |
|---|---|---|---|---|
| Anjani Synthetics Limited | 9.05 | — | 4.24 | — |
At the ₹140 upper band, the issue is priced at 14.2x earnings — a 57% premium to the peer median of 9.1x. This is the arithmetic of the price band against the peers the filing itself lists; it is not a view on whether the offer is worth taking.
🔍 Forensic Findings — What the Footnotes Say
Findings from across the filing — the notes, MD&A, related-party disclosures, contingent liabilities, CARO and litigation, alongside the risk section itself. Each carries where it was found, so you can see which were buried and which were disclosed. Findings marked derived are computed from the filed numbers against a stated rule, shown beside them.
In FY26 (pre-IPO year), reported PAT grew 42.53% to Rs. 4.0310 crore on revenue of Rs. 56.8511 crore. However, Cash Flow from Operations (CFO) collapsed to -Rs. 10.8512 crore (from +Rs. 0.7182 crore in FY25) due to inventory expanding 57.69% to Rs. 16.8586 crore (102 inventory days) and payables dropping by 53.95%.
p.21, 46, 48, 51In May 2024, promoters Sanjay Gupta & Sooraj Gupta were issued 3,629,500 bonus shares @ Rs. 0.00 following a preferential allotment of 203,500 shares @ Rs. 200.00, reducing their Weighted Average Cost of Acquisition (WACA) to Rs. 11.11 per share compared to the IPO issue price of Rs. 140.00.
p.61, 62, 105The company benchmarks its valuation against sole listed peer Anjani Synthetics Limited (mainboard listed, P/E 9.05x). At the issue price of Rs. 140.00, the issuer demands an implied P/E multiple of 14.23x, representing a 57.2% premium despite being an asset-light fabric trader with 9 employees.
p.101, 102The company disclosed multiple ROC filing errors and form inconsistencies (AOC-4 rent misstatement, DIR-12, CHG-1) requiring Form GNL-1 for penalty adjudication. Additionally, pending GST tax proceedings exist against promoter Sanjay Gupta (Rs. 0.0270 crore) and Sooraj Gupta (Rs. 0.0191 crore).
p.20, 21, 205, 237The company derives 67.59% of its FY26 revenue from operations from a single state (Delhi). Furthermore, wholesale trading of third-party denim fabrics accounts for 76.23% (Rs. 43.34 crore) of total revenue.
p.28, 142Indirect tax GST proceedings against Promoters: Show cause notice against Sanjay Gupta (M/s SR Fabrics) under Section 73 of CGST/DGST Act for FY18 involving Rs. 0.0270 crore (Rs. 2.70 lakhs); order against Sooraj Gupta (M/s SG Trader) under Section 74 of IGST/CGST/SGST Act for FY20 involving Rs. 0.0191 crore (Rs. 1.91 lakhs). Total tax proceedings: Rs. 0.0460 crore (Rs. 4.60 lakhs). Criminal or civil litigation: NIL.
p. 20, 21, 50, 237 and 1 moreOperating cash flow was negative ₹10.85 cr in FY26 while the company reported a profit after tax of ₹4.03 cr. Profit that does not arrive as cash has to be funded from somewhere else.
rule: CFO<0 & PAT>0Short-term borrowings of ₹10.58 cr against cash of ₹0.60 cr. Debt that must be refinanced within a year is comfortable only while lenders stay comfortable.
rule: cash < 0.5x short-term debtCompany's Claims vs Reality
We stress-test each claim against the filing's own data.
While revenue reached Rs. 56.85 crore in FY26, trading of third-party fabrics accounts for 76.23% of sales. Cash generation degraded severely in FY26 with CFO falling to -Rs. 10.85 crore, demonstrating that volume growth was financed by short-term bank debt and inventory lockup rather than cash flow.
p.21, 137, 142Delhi currently generates 67.59% of total revenue. Allocating Rs. 6.00 crore of equity proceeds to purchase a corporate/warehouse facility deepens geographical concentration in Delhi rather than expanding into new national markets.
p.28, 83Inventory days increased from 59 days in FY24 to 102 days in FY26, locking up Rs. 16.86 crore in buffer stock. Combined working capital (Rs. 11.50 crore) and GCP (Rs. 3.67 crore) represent 61.70% of total IPO proceeds.
p.21, 83, 91Live Subscription Status
Allotment Status
Check your allotment on the registrar's portal → Registrar: Maashitla Securities
Allotment is decided by the registrar, not by us and not by the exchange. In an oversubscribed retail book, allotment is by lottery, so a large application does not improve your odds beyond one lot. If money stays blocked after the refund date, the mandate expiry (27 Oct 2026) is the date to raise with your bank.
Analyst Q&A: Burning Questions
Facts from the filing. No recommendation — that layer arrives once our Research Analyst registration is live.
How are the fresh issue proceeds of Rs. 24.58 crore allocated, and what proportion goes to working capital and general corporate purposes?
Fresh issue proceeds are allocated as: Rs. 6.0000 crore for property purchase/fit-out in Delhi, Rs. 11.5000 crore for working capital, and Rs. 3.6688 crore for General Corporate Purposes (GCP). Working capital and GCP combined represent 61.70% of total issue proceeds.
p.83What is the promoters' shareholding pre and post-issue, and what is their acquisition cost history?
Promoters Sanjay Gupta, Sooraj Gupta, and Sanyogita Gupta hold 92.91% pre-issue, diluting to 65.02% post-issue. Promoters acquired 3,629,500 bonus shares in May 2024 at Rs. 0.00 cost, bringing their Weighted Average Cost of Acquisition (WACA) down to Rs. 11.11 per share compared to the IPO price of Rs. 140.00.
p.61, 62, 77, 105What related-party transactions and promoter business consolidations took place prior to the IPO?
On April 6, 2024, the company acquired the business assets and liabilities of three promoter proprietorship firms (M/s SG Trader, M/s SR Fabrics, M/s Neelmadhav Textiles) via Business Transfer Agreements. Director Sanyogita Gupta provided unsecured loans of Rs. 0.5306 crore during FY26, and director remuneration totaled Rs. 0.2400 crore.
p.46, 51, 208Why did operating cash flow collapse into negative territory in FY26 despite reported PAT growth?
In FY26, restated PAT grew 42.53% to Rs. 4.0310 crore, but Cash Flow from Operations (CFO) dropped to -Rs. 10.8512 crore (down from +Rs. 0.7182 crore in FY25). This negative cash conversion was driven by Rs. 6.1674 crore tied up in inventory expansion (rising to Rs. 16.8586 crore or 102 inventory days) and trade payables contraction of Rs. 5.0012 crore.
p.21, 48, 51What secretarial, statutory compliance, and workforce findings exist for the company?
The company operates with a workforce of only 9 employees. Disclosures note ROC filing errors (AOC-4 rent misstatement, DIR-12, CHG-1) requiring Form GNL-1 for penalty adjudication, along with pending GST show cause notices against promoter Sanjay Gupta (Rs. 0.0270 crore) and Sooraj Gupta (Rs. 0.0191 crore).
p.20, 21, 140, 237What are the lot size, retail ticket cost, market maker reservation, and exit conditions for public investors?
The fixed issue price is Rs. 140.00 per share with a market lot size of 1,000 shares, requiring a minimum retail application of 2 lots (2,000 shares) amounting to Rs. 2,80,000. Trading occurs strictly in standardized market lots of 1,000 shares, and because lots are indivisible, partial exit or fractional lot trading is impossible. Giriraj Stock Broking Private Limited is the Market Maker with 88,000 reserved shares (5.01%) and a mandatory 3-year obligation period. Standard SME 5% price circuit limits apply.
p.1, 3, 57, 60, 299What Earlier Investors Paid
Early capital takes real risk and is fairly rewarded for it — a large multiple built over many years is normal. What deserves a closer look is a steep step-up in a short window: a round priced cheaply only months before the offer.
| Shareholder | Priced at | When | vs IPO price |
|---|---|---|---|
| Sanjay Gupta & Sooraj Gupta | ₹10.00 | 2024-03-06 | 14.0x |
| Sanjay Gupta & Sooraj Gupta | — | 2024-05-18 | — |
| Innovest Ventures, Samta Devi Baid & Others | ₹110.00 | 2024-06-01 | 1.3x |
| Allotted below the band — 1 entries | |||
| Sanjay Gupta & Sooraj Gupta | ₹200.00 | 2024-05-15 | as disclosed |
The 1 allotments listed under “allotted below the band” are shown at their as-disclosed per-share price. They are not adjusted for any later bonus issue or share split, so where a company has issued bonus shares the raw multiple understates the true return and can even read as a loss when none was made. We show them as filed and decline to compute a misleading multiple.
Prices are as stated in the filing’s allotment history and are not adjusted for later bonus issues or share splits. Where a company has issued bonus shares, the multiples above understate the true return and can even read as losses. Adjusting for that is on our list; until it is done we would rather show the raw disclosure and tell you its limits than publish a confident number that is wrong.
Lock-in Expiry Calendar
Shares held before the IPO cannot be sold immediately; they unlock in tranches. When a tranche unlocks, more shares become eligible to trade. Retail investors are frequently caught unaware by these dates. The schedule below follows from the listing date; quantities are shown only where the filing discloses them.
- 18 Sep 2029promoter3 years1,170,360 shares (20% of total)
- 18 Sep 2028promoter2 years1,317,105 shares (22.51% of total)
- 18 Sep 2027promoter1 year1,317,105 shares (22.51% of total)
- 18 Sep 2027public1 year290,430 shares (4.96% of total)
An unlock means more shares may be sold — not that they will be, and not that the price will move. We state the dates; what you do with them is your call.
Educational, grounded entirely in the company's filings (DRHP/RHP). Not investment advice. FinMinutes does not provide buy/sell recommendations.