Yajur Fibres Ltd.

About Yajur Fibres

Originally incorporated in 1980 in Kolkata, Yajur Fibres operates a bast fibre cottonising unit. It manufactures cottonised flax (linen), jute and hemp fibres used in apparel, home textiles, insulation, automotive parts and paper. Around 90% of FY25 sales were domestic, with key markets including Andhra Pradesh, Tamil Nadu, Gujarat and West Bengal; the company also exports to countries including Turkey, Nepal and Indonesia.

Yajur Fibres IPO Details

Use of IPO Proceeds

IPO Reservation: QIB shares offered: <=50%; Retail shares offered: >=35%; NII (HNI) shares offered: >=15%. Registrar: MAS Services. Book Running Lead Managers: Horizon Management.

Strengths

• Forward integration: Through subsidiary Yashodha Linen Yarn Ltd., the company plans to make 100% wet spun linen yarn and blended yarn from cottonised fibre. The proposed greenfield unit is on 35 acres in Ujjain, Madhya Pradesh, with commencement targeted by Jan’27.
• Investment in subsidiary: The company is investing INR 148.83 cr in the facility, with INR 48 cr of IPO proceeds allocated towards the subsidiary’s capital expenditure.
• Existing unit expansion: An INR 11.92 cr IPO-funded project includes a 50,000 sq. ft. shed and additional machinery. The report states that capacity is expected to increase by 4 tons per day, with DCCO in Jun’26.
• Long-term capacity ambition: The company’s stated target is overall cottonising capacity of 15,000 tons per year by 2030. Management’s stated target for optimum utilization after the existing-unit expansion is 85%.
• Sustainability positioning: The company is promoting jute and hemp fibres as biodegradable, ecological alternatives to synthetic materials.

FY25 revenue growth was attributed to new product variants, higher price realization on flax and jute products, and better capacity utilization than in FY24.

Yajur Fibres Key Financials

Revenue increased across FY23–FY25, while gross margin declined from 41.8% in FY23 to 28.1% in FY25. Debt rose to 66.2 in FY25 and 73.6 in Nov’25; the Nov’25 figures are not annualized where marked.

IPO Valuation and Our View

At the IPO price band of INR 168 to 174 per share, the issue is valued at a P/E ratio of 33.8x based on FY25 PAT. The report cites capacity expansion, sustainability and premiumization as positives, but considers these offset by raw-material risks, fluctuating margins and aggressive IPO valuation. Recommendation: Avoid.

Key Risks

• Raw-material dependence: Operations rely heavily on flax fibre, mainly imported from France and Belgium, as well as jute. A poor crop in FY24 caused a shortage and reduced capacity utilization; utilized capacity had yet to reach FY23 levels.
• Revenue concentration: Cottonised Flax contributed 84.16% of FY25 revenue, and around 60% of FY25 revenue came from the top 5 customers.
• Working capital and debt: The report flags increases in inventory and debt, and deterioration in the working-capital cycle, as monitorables. NWC days were 169 in FY25 and 275 in Nov’25.
• Capacity utilization: Utilization was 59.05% in FY25 and 66.96% in Nov’25, below the management-stated optimum target of 85% after expansion.

Product Mix and Capacity

Cottonised Flax accounted for 84.16% of FY25 revenue and 77.81% in Nov’25. The company’s domestic share of revenue was 89.7% in FY25 and 87.7% in Nov’25. At Nov’25, installed capacity was 2800 MTPA and utilized capacity was 1875 MTPA, with utilization of 66.96%.

Management and Shareholding

• Ashish Kankaria: Promoter and Managing Director, age 43. He holds a Post Graduate Diploma in Management from S.P. Jain Institute of Management & Research and has over a decade of experience in manufacturing and distribution of jute fibre.
• Shruti A Kankaria: Promoter, Non Executive and Non Independent Director, age 44, with more than 16 years of experience in management and general administration.

Peer Comparison

The report notes that the RHP mentions no peers. It compares Yajur Fibres with K.P.R. Mills, while cautioning that their business models are not comparable. For FY25, Yajur Fibres’ P/E ratio is shown as 33.8x and K.P.R. Mills’ as 35.6x.

Our View

The proposed investments would expand capacity and add linen yarn production, while the company is also positioning jute and hemp as sustainable materials. However, dependence on flax and customer concentration, alongside fluctuating margins and the report’s assessment of aggressive IPO valuation, underpin Minerva Capital Research Solutions’ Avoid rating.

Standard disclosures

• Research Analyst has served as an officer, director or employee of subject company(ies): No
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Regulatory disclosures

Minerva Capital Research Solutions is an independent investment advisory firm founded by Nishant Gupta(SEBI registration no. INH000018896).

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For any queries or grievances: Mr. Nishant Gupta | Email: nishant.gupta@mcapital.in or guptanishant.iimi@gmail.com | Contact Number: 8171433387 | Website: www.mcapital.in | Twitter: @Mcapital_In

• Equity Research Analyst for this report: Mr. Shubham Upadhyay (shubham.upadhyay@mcapital.in)

Rating rationale

Minerva Capital Research Solutions endeavors to provide objective opinions and recommendations. Ratings are assigned to stocks according to their fair value vs current market price and then categorizes them as Buy, Hold, Reduce, Sell. The performance horizon is one year unless specified and fair value is defined as analyst’s valuation for a stock.

• Buy: > 15%
• Hold: -5% to 15%
• Reduce: -15% to -5%
• Sell: <-15%