Sonaselection India shares list at 3% premium on BSE, NSE; should you buy, sell or hold?

New business data points to the fact that Shares of Sonaselection India made a decent debut on the bourses on September 24, stock-exchange debut at a premium of around 3% over the firm's IPO price.

The shares opened at Rs 102.21 on the NSE, marking a 3.34% premium over the IPO price of Rs 99 per share. On the BSE, the stock debuted at Rs 102, up 3.03% from the offering price.

Following the stock-exchange debut, Sonaselection India's market capitalisation stood at around Rs 579.65 crore.

The stock debuted above the grey market indication ahead of stock-exchange debut. InvestorGain had noted a GMP of Rs 0 on September 23, implying an estimated stock-exchange debut price of Rs 99, equal to the upper end of the IPO price range.

GMP, or grey market premium, is an unofficial indicator based on transactions in the grey market. It can change before stock-exchange debut and does not guarantee the actual stock-exchange debut price or post-stock-exchange debut performance.

The Rs 141.57-crore Sonaselection India IPO was subscribed 2.01 times during the three-day bidding period from September 17 to September 21.

According to NSE data, market participants placed bids for 2,01,04,050 shares against 1,00,10,000 shares on offer. The retail investor portion was subscribed 2.50 times, while the non-institutional investor (NII) category received 1.99 times subscription.

The offering comprised entirely a fresh offering of 1.43 crore equity shares and carried a price range of Rs 94-99 per share.

Sonaselection India plans to use Rs 80 crore from the IPO proceeds towards the partial repayment or prepayment of debt. The firm had outstanding borrowings of Rs 263.8 crore as of July 2026.

Another Rs 50.61 crore has been earmarked for capital expenditure, including the purchase of plant and machinery at its existing manufacturing facility in Rajasthan. The remaining proceeds will be used for general corporate purposes.

Ahead of the IPO, the firm boosted Rs 42.47 crore from anchor market participants. It allotted 42.9 lakh shares to three anchor market participants at the upper end of the price range.

Astorne Capital was the largest anchor investor, picking up 22.96 lakh shares for around Rs 22.7 crore. India Max Investment Fund and Lords Multigrowth Fund each acquired 9.96 lakh shares for around Rs 9.86 crore. Should you buy, sell or hold?

Mahesh M. Ojha, Vice President, Research & Business Development at Kantilal Chhaganlal Securities Pvt. Ltd. stated, "Sona Selection India Ltd. is an integrated textile manufacturing and processing firm with an 82.44 million metres p.a. capacity at its Bhilwara facility and a diversified product portfolio across cotton, blended and polyester fabrics."

At 16.53x FY26 P/E, the offering trades at a discount to the 22.58x industry average, offering valuation comfort. That stated, the firm’s smaller scale and declining EBITDA margin despite firm topline expansion stay key concerns.

"Allotted market participants may consider booking stock-exchange debut upside, if available, while fresh market participants may wait for post-stock-exchange debut price stabilisation and assess subsequent quarterly earnings before taking a long-term position," Ojha stated.

Sonaselection India is a textile manufacturer based in Bhilwara, Rajasthan. The firm manufactures 100% cotton fabric, cotton lycra or stretch fabric, cotton blends and polyester blends.

Its manufacturing facility has an installed processing capacity of 82.44 million metres per annum. The firm was incorporated in February 2022 and operates as an integrated fabric manufacturing and processing firm.

Choice Capital Advisors was the book-running lead manager for the IPO, while KFin Technologies was the registrar to the offering.