Sellowrap Industries Ltd IPOSELLOWRAP

The IPO opens on 25 Jul 2025 & closes on 29 Jul 2025.

The Business in automobile industry has been established for four decades. Sellowrap Industries Limited, has gone through all stages from being Proprietorship formed by Mr. Sushil Kumar Poddar, father of Mr. Saurabh Poddar in year 1983. Further, On May 06, 1992, Mr. Sushil Kumar Poddar formed a partnership firm under the name 'M/s. Sellowrap Manufacturing Company' through a Partnership Agreement. The firm was engaged in the manufacturing and distribution of automotive components and related products at Gurugram. However, Company was incorporated on April 06, 2004, as a Private Limited Company in the name of 'Sellowrap Manufacturing Private Limited' with the Registrar of Companies, Maharashtra, Mumbai, which acquired the entire running business of M/s. Sellowrap Manufacturing Company as a going concern dated July 01, 2004. Subsequently, the name of Company was changed from 'Sellowrap Manufacturing Private Limited' to 'Sellowrap Industries Private Limited' on February 16, 2011. Further, Company was converted from Private Limited to Public Limited and the name of the Company was changed from 'Sellowrap Industries Private Limited' to Sellowrap Industries Limited' on October 15, 2024 by the Central Processing Centre. Sellowrap Industries Limited is a manufacturing company, headquartered in Mumbai, specializing in the production of customized components for automotive and white goods industries. Operating in the B2B sector, it offer both adhesive and non-adhesive processed components, delivering solutions on emphasizing quality, cost-efficiency and customer value. With more than four decades of experience, the SK Group, comprising the Holding Company, its Promoter Company M/s. Saurabh Marketing Private Limited, its Associate company M/s. Sellowrap EPP Private Limited and Group Companies M/s. Prystine Food & Beverages Private Limited & M/s. Proton Consultancy Services Private Limited has established itself in diverse industries. Company has been serving major Original Equipment Manufacturers (OEMs) in India and abroad, by manufacturing components from a wide range of foam and plastic grades. In 2006, the Company acquired a controlling shareholding in Sellowrap EPP Private Limited, making it an Associate Company. In 2018, it commissioned the Ranipet Plant, commissioned the Chakan Plant at Pune in 2021. The Company is taking steps by moving to a facility in Pune to enhance capacity and capabilities. Additionally, it is consolidating operations in Gurugram by developing new, innovative Special Purpose Machines (SPMs) in 2024-25. Company launched the initial public offering of 36,48,000 equity shares of Rs 10 each by raising Rs 30.27 Cr. through fresh issue in July, 2025.

Sellowrap Industries Ltd IPO will close on 29 Jul 2025.

<ul><li>We heavily rely on the Automobile Sector's performance.</li><li>Raw material fluctuations can negatively impact us.</li><li>Reduced product demand may harm business.</li><li>Manufacturing disruptions could affect operations.</li><li>Machinery breakdowns may delay product delivery.</li><li>Dependency on limited suppliers risks our business.</li><li>Top 10 customers drive most of our revenue.</li><li>We may continue related party transactions.</li><li>Ongoing litigation may affect our operations.</li><li>Payment delays or defaults could harm us.</li></ul>

<table class="table"> <thead> <tr> <th>S.No</th> <th>Promoters Name</th> <th>Pre Issue Shares</th> <th>Pre Issue Percentage</th> <th>Post Issue Shares</th> <th>Post Issue Percentage</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Saurabh Poddar</td> <td>1630200</td> <td>16.15</td> <td>1630200</td> <td>11.86</td> </tr> <tr> <td>2</td> <td>Sushil Kumar Poddar</td> <td>3654600</td> <td>36.2</td> <td>3654600</td> <td>26.59</td> </tr> <tr> <td>3</td> <td>Pooja Poddar</td> <td>995000</td> <td>9.86</td> <td>995000</td> <td>7.24</td> </tr> <tr> <td>4</td> <td>Saurabh Marketing Pvt Ltd</td> <td>2477000</td> <td>24.53</td> <td>2477000</td> <td>18.02</td> </tr> <tr> <td>5</td> <td>Sushil Kumar Poddar (HUF)</td> <td>---</td> <td>---</td> <td>---</td> <td>---</td> </tr> <tr> <td>6</td> <td>Meena Poddar</td> <td>342500</td> <td>3.39</td> <td>342500</td> <td>2.49</td> </tr> <tr> <td>7</td> <td>Khush Poddar</td> <td>20</td> <td>---</td> <td>20</td> <td>---</td> </tr> <tr> <td>8</td> <td>Sushila Sharaff</td> <td>16000</td> <td>0.16</td> <td>16000</td> <td>0.12</td> </tr> </tbody> </table>

<ul><li>The company is heavily dependent on the performance of the Automobile Sector.</li><li>Its business depends on the smooth operation of the company manufacturing facilities and workforce availability, with any disruptions such as strikes, equipment failures, or regulatory changes potentially impacting its financial condition and operational results.</li><li>Delay in delivery of the products due to breakdown of machinery.</li><li>The company derives a majority portion of its revenue from operations from the company top 10 customers, contributing towards its total gross sales.</li><li>Risk of Unsustainability of PAT Margin Increase in FY 24 and FY 25.</li><li>The Company, Promoters, Directors and Group Companies are involved in certain legal proceedings. An adverse outcome in any of these proceedings may adversely affect its reputation, business, results of operations, financial condition and cash flows.</li><li>The company is unable to trace the Bank Statement of the Company for allotments made in past.</li><li>The company has had certain inaccuracies in relation to regulatory filings and the company has made non- compliances of certain provision under applicable law.</li><li>The Company has higher debt-equity ratio which requires significant cash flows to service its debts obligations, and this, together with the conditions and restrictions imposed by the company financing arrangements, fluctuations in the interest rates may limit its ability to operate freely and grow the company business.</li><li>The company is unable to trace the Bank Statement of the Company for allotments made in past.</li><li>The success of its business operations is dependent on the company Promoter and Managing Director, and on Directors, Key Managerial Personnel and Senior Management as well as its ability to attract, train and retain employees.</li><li>There are certain discrepancies / errors noticed in some of its corporate records relating to forms filed with the Registrar of Companies and other provisions of Companies Act, 2013. Any penalty or action taken by any regulatory authorities in future for non-compliance with provisions of corporate and other law could impact the financial position of the Company to that extent.</li><li>Difference in the details mentioned in the KYC documents of Mr. Sarabjit Singh Mokha, its Executive Director of the Company.</li><li>The company Registered Office is not owned by it. The same is occupied by its on an authorization letter granting permission for its use by the company Managing Director and Promoter, Mr. Saurabh Poddar. There is no lease agreement between the Company and Mr. Saurabh Poddar.</li><li>The nature of its business exposes the company to liability claims and contract disputes and its indemnities may not adequately protect the company. Any liability more than its reserves or indemnities could result in additional costs, which would reduce its profits.</li><li>The company Factories are not owned by it. The same is occupied on lease. Disruption of the company rights as lessee or termination of the agreement with lessor would adversely impact its operations and, consequently, the company business.</li><li>The company generate its major portion of sales from its operations in certain geographical regions especially Haryana, Karnataka, Maharashtra and Tamil Nadu. Any adverse developments affecting its operations in these regions could have an adverse impact on the company revenue and results of operations.</li><li>The Company has a negative cash flow in its operating activities in the financial year 2022 and in its investing activities in the September 30, 2024 & Financial year 2024, 2023 & 2022 and in its Financing Activities in the financial year 2024, details of which are given below. Sustained negative cash flow could impact its growth and business.</li><li>The company has had certain inaccuracies in relation to regulatory filings and the company has made non-compliances of certain provision under applicable law.</li><li>There are certain delays in filing returns with Certain Government Authorities. Any penalty or action taken by any regulatory authorities in future for non-compliance with provisions of relevant act could impact the financial position of the Company to that extent.</li><li>The company relies heavily on the availability of key raw materials to procure them. As the company has not established long-term agreements with these suppliers, any inability to secure sufficient raw materials at competitive prices could adversely impact its business, financial condition, and operational results. Any fluctuations in prices, availability of raw material or storage in supply of raw material for manufacturing of its products would adversely impact the company business.</li><li>Its Promoters and the Promoter Group will jointly continue to retain majority shareholding in the Company after the issue, which will allow them to determine the outcome of the matters requiring the approval of shareholders.</li><li>Its business is operating under various laws which require the company to obtain approvals from the concerned statutory/regulatory authorities in the ordinary course of business and its inability to obtain, maintain or renew requisite statutory and regulatory permits and approvals for the company business operations could materially and adversely affect its business, prospects, results of operations and financial condition. The company requires several approvals, NOCs, licenses, registrations and permits in the ordinary course of its business. Some of the approvals are required to be obtained by the Issuer Company and any failures or delay in obtaining the same in a timely manner may adversely affect its operations.</li><li>The average cost of acquisition of Equity Shares by the Promoters may be less than the Offer price.</li><li>The company faces foreign exchange risks that could adversely affect its results of operations and cash flows.</li><li>The company has entered related party transactions in the past and may continue to do so in the future.</li><li>Guarantees from Promoters as well as others have been taken in relation to the debt facilities provided to it.</li><li>The company insurance coverage may not adequately protect it against losses, and successful claims against the company that exceed its insurance coverage could harm the companyr results of operations and diminish its financial position.</li><li>Brand recognition is important to the success of the company's business, and its inability to build and maintain the company brand name will harm its business, financial condition and results of operation.</li><li>The objects of the Offer have not been appraised by any bank or financial institution and the company cannot assure you that the objects of the Offer will be achieved within the expected time frame, or at all, and any variation in the utilisation of the Net Proceeds would be subject to certain compliance requirements, including prior shareholders' approval.</li><li>The company depends significantly on third-party logistics provider to provide transport facilities. A loss of, or a significant decrease in services provided by logistics provider could adversely affect its business and profitability.</li><li>The shortage or non-availability of power facilities may adversely affect its business and have an adverse impact on the company results of operations and financial condition.</li><li>Major fraud lapses of internal control, system failures, theft, or similar incidents could adversely impact the Company's business.</li><li>The company inability to manage growth could disrupt its business and reduce the company profitability. The company propose to expand its business activities in coming financial years.</li><li>Employee fraud and Misconduct or errors by manpower engaged by it could expose the company to business risks or losses that could adversely affect its business prospects, results of operations and financial condition.</li><li>The company operations may be adversely affected in case of industrial accidents at its working sites.</li><li>The company's ability to pay dividends in the future will depends upon its future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in the company financing arrangements.</li><li>Any future acquisitions, joint ventures, partnerships, strategic alliances, tie-ups or investments could fails to achieve the expected synergies and may disrupt its business and harm the results of operations and the company financial condition.</li><li>Its future funds requirements, in the form of a fresh issue of capital or securities and/or loans taken by it, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.</li><li>The company's KMP has been associated with the Company for less than one year.</li><li>There is no guarantee that its Equity Shares will be listed on the Stock Exchanges in a timely manner or at all.</li><li>The deployment of funds raised through This Offer shall not be subject to any Monitoring Agency and shall be purely dependent on the discretion of the management of the Company.</li><li>Industry information included in this Draft Red Herring Prospectus has been derived from publicly available industry reports and/or websites. There can be no assurance that such third-party statistical financial and other industry information is either complete or accurate.</li><li>The requirements of being a public listed company may strain its resources and impose additional requirements.</li><li>The company actual results could differ from the estimates and projections used to prepare its financial statements.</li><li>The company lenders have charge over its immovable and movable properties in respect of finance availed by it.</li><li>The company Promoters and Executive Directors hold Equity Shares in the Company and are therefore interested in the Company's performance in addition to their remuneration and reimbursement of expenses.</li><li>There are restrictions on daily/weekly/monthly movements in the price of the Equity Shares, which may adversely affect a shareholders' ability to sell, or the price at which it can sell, Equity Shares at a particular point in time.</li><li>After this Issue, the price of the Equity Shares may be highly volatile, or an active trading market for the Equity Shares may not develop.</li><li>The Offer price of its Equity Shares may not be indicative of the market price of the company Equity shares after the issue.</li><li>The company relies on contractors for the recruitment of contract labourers and are therefore exposed to execution risks and liability towards labourers under applicable Indian laws.</li><li>The success of its business operations is dependent on the company Promoter and Managing Director, and on Directors, Key Managerial Personnel and Senior Management as well as its ability to attract, train and retain employees.</li><li>There are certain discrepancies / errors noticed in some of its corporate records relating to forms filed with the Registrar of Companies and other provisions of Companies Act, 2013. Any penalty or action taken by any regulatory authorities in future for non-compliance with provisions of corporate and other law could impact the financial position of the Company to that extent.</li><li>There are certain delays in filing returns with Certain Government Authorities. Any penalty or action taken by any regulatory authorities in future for non-compliance with provisions of relevant act could impact the financial position of the Company to that extent.</li><li>Its KMP has been associated with the Company for less than one year.</li><li>Information relating to the historical installed capacities of its Manufacturing is based on certain assumptions and estimates by the chartered engineer which may vary and future production and capacity utilisation may vary.</li><li>The company operates in a highly competitive industry and increased competition may lead to a reduction in its revenues, reduced profit margins or a loss of market share.</li><li>Potential Challenges Arising from Independent Directors' Limited Experience in Listed Companies.</li><li>The company is subject to strict quality requirements and any failures to comply with quality standards may lead to cancellation of existing and future orders, product recalls, product liability, warranty claims and other disputes and claims.</li><li>Certain non-GAAP financial measures and certain other financial information relating to its operations and financial performance have been included in this offer document. These non-GAAP financial measures are not measures of operating performance or liquidity defined by Accounting Standards and may not be comparable.</li><li>The company is exposed to counterparty credit risk and any delay in receiving payments or non-receipt of payments may adversely impact the results of operations.</li><li>There might be the availability of counterfeit products, which could result in a loss of market share for the company. Additionally, failures to maintain the confidentiality of technical knowledge may lead to significant financial losses and harm to the company's competitive position.</li><li>The company might infringe upon the intellectual property rights of others and any misappropriation of its intellectual property could harm its competitive position.</li><li>The Company is yet to place orders for the equipment, plant and machinery for the expansion of the Manufacturing Facility. Any delay in placing orders or procurement of such equipment, plant and machinery may delay the schedule of implementation and possibly increase the cost of commencing operations.</li><li>The Automotive Industry is highly competitive with limited market players. The Pricing pressure from customers may adversely affect its gross margin, profitability and ability to increase the company prices.</li><li>Its may be unable to growth effectively and further expand the company business into new markets, future financial performance and results of operations could be materially and adversely affected. The success of its business will depends on its ability to effectively implement the company business and growth strategy.</li><li>The Company is subject to numerous labour and employment-related laws and regulations in India, including but not limited to, the Factories Act, 1948, the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, the Employees' State Insurance Act, 1948, the Contract Labour (Regulation and Abolition) Act, 1970, the Payment of Gratuity Act, 1972, the Minimum Wages Act, 1948, and other applicable statutes, rules and guidelines. These laws regulate the terms of employment, working conditions, welfare, health and safety measures, social security benefits, and other labour welfare obligations.</li><li>If design and development efforts does not succeed and the company is unable to respond changing customer preferences in timely and effective manner or current technologies becomes obsolete due to changes in technology which the company is not able to achieve it may have an adverse effect on its business, cash flows, results of operations and financial condition.</li><li>Non-compliance with and adverse changes in applicable health, safety, labour and environmental laws may adversely affect its business, results of operations and financial condition.</li><li>The company has certain contingent liabilities as on date of this Red Herring Prospectus that have been provided for in the Company's financials which if materialized, could adversely affect its financial condition.</li><li>Significant disruptions in its information technology systems or breaches of data security could adversely affect the company business and reputation.</li><li>Its business is operating under various laws which requires it to obtain approvals from the concerned statutory/regulatory authorities in the ordinary course of business and its inability to obtain, maintain or renew requisite statutory and regulatory permits and approvals for its business operations could materially and adversely affect the company business, prospects, results of operations and financial condition. The company requires several approvals, NOCs, licenses, registrations and permits in the ordinary course of its business. Some of the approvals are required to be obtained by the company Issuer Company and any failures or delay in obtaining the same in a timely manner may adversely affect its operations.</li><li>The company operates without a formal order book or binding long-term agreements for its domestic and export operations in the automotive components sector.</li><li>Difference in the details mentioned in the KYC documents of Mr. Sarabjit Singh Mokha, its Executive Director of the Company.</li><li>Its Registered Office is not owned by it. The same is occupied by the company on an authorization letter granting permission for its use by its Managing Director and Promoter, Mr. Saurabh Poddar. There is no lease agreement between the Company and Mr. Saurabh Poddar.</li><li>The nature of its business exposes the company to liability claims and contract disputes and its indemnities may not adequately protect the company. Any liability more than its reserves or indemnities could result in additional costs, which would reduce its profits.</li><li>Its Factories are not owned by the company. The same is occupied on lease. Disruption of its rights as lessee or termination of the agreement with lessor would adversely impact its operations and, consequently, the company business.</li><li>The company generate its major portion of sales from the company operations in certain geographical regions especially Haryana, Karnataka, Maharashtra and Tamil Nadu. Any adverse developments affecting its operations in these regions could have an adverse impact on the company revenue and results of operations.</li><li>The Company has a negative cash flow in its investing activities in Financial year 2025, 2024 and 2023 and in its Financing Activities in the financial year 2024, details of which are given below. Sustained negative cash flow could impact its growth and business.</li><li>The company relies heavily on the availability of key raw materials to procure them. As the company has not established long-term agreements with these suppliers, any inability to secure sufficient raw materials at competitive prices could adversely impact its business, financial condition, and operational results. Any fluctuations in prices, availability of raw material or storage in supply of raw material for manufacturing of its products would adversely impact the company business.</li><li>Its Promoters and the Promoter Group will jointly continue to retain majority shareholding in the Company after the issue, which will allow them to determine the outcome of the matters requiring the approval of shareholders.</li><li>The average cost of acquisition of Equity Shares by the Promoters may be less than the Offer price.</li><li>The company faces foreign exchange risks that could adversely affect its results of operations and cash flows.</li><li>The company has entered related party transactions in the past and may continue to do so in the future.</li><li>Guarantees from Promoters as well as others have been taken in relation to the debt facilities provided to the company.</li><li>Its insurance coverage may not adequately protect the company against losses, and successful claims against it that exceed the company insurance coverage could harm its results of operations and diminish the company financial position.</li><li>Brand recognition is important to the success of its business, and the company inability to build and maintain its brand name will harm the company business, financial condition and results of operation.</li><li>The objects of the Offer have not been appraised by any bank or financial institution and we cannot assure you that the objects of the Offer will be achieved within the expected time frame, or at all, and any variation in the utilisation of the Net Proceeds would be subject to certain compliance requirements, including prior shareholders' approval.</li><li>The company depends significantly on third-party logistics provider to provide transport facilities. A loss of, or a significant decrease in services provided by logistics provider could adversely affect its business and profitability.</li><li>The shortage or non-availability of power facilities may adversely affect its business and have an adverse impact on the company results of operations and financial condition.</li><li>Major fraud lapses of internal control, system failures, theft, or similar incidents could adversely impact the Company's business.</li><li>Its inability to manage growth could disrupt the company business and reduce its profitability. The company propose to expand the company business activities in coming financial years.</li><li>Employee fraud and Misconduct or errors by manpower engaged by it could expose the company to business risks or losses that could adversely affect its business prospects, results of operations and financial condition.</li><li>Its operations may be adversely affected in case of industrial accidents at the company working sites.</li><li>Its ability to pay dividends in the future will depends upon the company future earnings, financial condition, cash flows, working capital requirements, capital expenditure and restrictive covenants in its financing arrangements.</li><li>Any future acquisitions, joint ventures, partnerships, strategic alliances, tie-ups or investments could fails to achieve the expected synergies and may disrupt its business and harm the results of operations and the company financial condition.</li><li>Its future funds requirements, in the form of a fresh offer of capital or securities and/or loans taken by it, may be prejudicial to the interest of the shareholders depending upon the terms on which they are eventually raised.</li><li>There is no guarantee that its Equity Shares will be listed on the Stock Exchanges in a timely manner or at all.</li><li>The deployment of funds raised through This Offer shall not be subject to any Monitoring Agency and shall be purely dependent on the discretion of the management of the Company.</li><li>Industry information included in this Red Herring Prospectus has been derived from publicly available industry reports and/or websites. There can be no assurance that such third-party statistical financial and other industry information is either complete or accurate.</li><li>The requirements of being a public listed company may strain its resources and impose additional requirements.</li><li>Its actual results could differ from the estimates and projections used to prepare the company financial statements.</li><li>Its lenders have charge over the company immovable and movable properties in respect of finance availed by it.</li><li>Its Promoters and Executive Directors hold Equity Shares in the Company and are therefore interested in the Company's performance in addition to their remuneration and reimbursement of expenses.</li><li>There are restrictions on daily/weekly/monthly movements in the price of the Equity Shares, which may adversely affect a shareholders' ability to sell, or the price at which it can sell, Equity Shares at a particular point in time.</li><li>After this Offer, the price of the Equity Shares may be highly volatile, or an active trading market for the Equity Shares may not develop.</li><li>The Offer price of its Equity Shares may not be indicative of the market price of the company Equity shares after the offer.</li></ul>

The Issue type of Sellowrap Industries Ltd is Book Building - SME.

The minimum application for shares of Sellowrap Industries Ltd is 3200.

The total shares issue of Sellowrap Industries Ltd is 3648000.

Initial public offer of upto 36,48,000 equity shares of face value of Rs. 10.00 each ("Equity Shares") of Sellowrap Industries Limited (the "Company" or the "Issuer") for cash at a price of Rs. 83 per equity share including a share premium of Rs. 73 per equity share (the "Offer Price") aggregating to Rs. 30.28 crores ("the Issue"). The offer includes a reservation of upto 1,82,400 equity shares aggregating to Rs. 1.51 crores will be reserved for subscription by market maker to the offer (the "Market Maker Reservation Portion"). The offer less the market maker reservation portion i.e. net offer of upto 34,65,600 equity shares aggregating to Rs. 28.77 crores (the "Net Issue").