Qualiance International SME IPO

Strengths · 8

• 01Profit has grown every year, from Rs 1.58 crore in FY2023 to Rs 2.84 crore in FY2024 and Rs 4.90 crore in FY2025, and it earned Rs 5.49 crore in just the half year to 30 September 2025.
• 02Sales grew strongly in FY2025, from Rs 38.14 crore to Rs 55.06 crore.
• 03EBITDA improved from Rs 2.98 crore in FY2023 to Rs 4.86 crore in FY2024 and Rs 7.97 crore in FY2025.
• 04Return ratios are good, with RoNW of 35.44% and RoCE of 21.16%, and the issue is priced at about 14.4 times earnings on an EPS of Rs 8.82.
• 05This is a specialised area. Military, police and protective garments have to meet strict specifications and compliance tests, which keeps ordinary garment makers out.
• 06It sells to European military, government and institutional buyers, which are demanding customers to qualify with and tend to stay once qualified.
• 07Net worth has turned around completely, from minus Rs 2.32 crore in FY2023 to Rs 19.31 crore as on 30 September 2025.
• 08The whole issue is fresh capital, and Rs 31.35 crore of it goes into a new manufacturing facility at Tiruppur, which will add capacity.

Risks · 10

• 01The financial data is old and incomplete for an issue opening in September 2026. The latest column is only a half year ending 30 September 2025, so there is no recent full year to judge the company on.
• 02The FY2023 figures do not sit together. Net worth is shown as minus Rs 2.32 crore while reserves are shown as plus Rs 3.17 crore for the same year. This needs to be checked in the RHP.
• 03There is no total borrowing row in the financial data available, so the debt level of the company cannot be assessed from here.
• 04The company had negative net worth as recently as FY2023, so the recovery is recent and still short.
• 05Almost the whole business depends on overseas government and institutional buyers. Such orders come through tenders, are lumpy and can be delayed or cancelled by budget decisions.
• 06Export concentration brings currency risk and exposure to trade rules, duties and procurement policy changes in the buying countries.
• 07The company runs a single facility at Tiruppur with an installed capacity of 4,50,000 pieces a year, which is modest, and any problem at that one location stops production.
• 08Garment manufacturing is competitive and buyers can move orders to other countries on price, even in the technical segment.
• 09Promoter holding will come down from 86.49% to 63.66% after the issue.
• 10This is an SME issue. One lot is 1,000 shares, which is Rs 1.27 lakh at the upper band of Rs 127, and SME shares usually trade in low volume after listing.

Qualiance International Limited designs, engineers, manufactures and exports performance garments. These are not ordinary clothes but technical garments made to a buyer's specification, and its customers are governments, institutions and brands in overseas markets.

Its product range covers military uniforms, tactical outerwear, high visibility workwear, weather resistant and all weather outerwear, police and border patrol uniforms, protective workwear and performance activewear. It has made garments to the specifications and compliance requirements of European military, government and institutional buyers.

The company runs one manufacturing facility at Tiruppur in Tamil Nadu. It has a built up area of more than 45,000 square feet on a land area of about 1,046.31 square metres, with an installed capacity of 4,50,000 garment pieces a year. It describes its strengths as in house manufacturing with quality control, reach in international markets and combined expertise in high performance technical garments.

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