Shakti Polytarp Limited, a Madhya Pradesh-based manufacturer of tarpaulins and trader of polymer granules, has filed its Draft Red Herring Prospectus (DRHP) for an SME IPO. The company plans to raise ₹20.88 crore through a fresh issue to fund capital expenditure for plant and machinery, alongside general corporate purposes.

About the Company

Incorporated in 2018 and headquartered in Indore, Shakti Polytarp operates under the brand name Dinotarp. The company engages in two primary business activities: manufacturing water-resistant tarpaulins ranging from 70 GSM to 450 GSM and trading polymer granules. Its products, including Geotextile, Lumber Wrap, House Wraps, Pond Liners, and Green Net, serve diverse sectors such as Agriculture, Construction, Automotive, and Logistics.

The company operates primarily on a B2B model, though it also caters to the B2C segment. Shakti Polytarp runs a large-scale manufacturing unit of 1,98,450 sq. ft. at Nimrani, Dist. Khargone, Madhya Pradesh. Notably, both the manufacturing facility and the registered office are leased properties, not owned by the company.

Financial Performance

Shakti Polytarp has demonstrated rapid scaling over the past three years. Revenue from operations grew from ₹62.01 crore in FY2024 to ₹166.24 crore in FY2025, and further to ₹215.65 crore in FY2026. This represents a cumulative growth of approximately 247.77% over two years.

Profitability has also improved significantly. Net profit (PAT) rose from ₹0.98 crore in FY2024 to ₹4.97 crore in FY2025, reaching ₹10.06 crore in FY2026. PAT margins expanded from 1.58% in FY2024 to 4.66% in FY2026.

Total assets grew from ₹40.29 crore in FY2024 to ₹110.12 crore in FY2026, reflecting significant capital investment. While operating cash flow turned positive at ₹13.40 crore in FY2026 after being negative in prior years, net cash flow remained negative at -₹3.29 crore due to heavy investing outflows of -₹36.85 crore.

Why the Company Is Raising Funds

The company intends to utilize the net proceeds from the fresh issue for the following purposes:

• Capital Expenditure: ₹20.88 crore will be deployed towards the purchase of plant and machinery to enhance existing production capacity and improve operational efficiency.
• General Corporate Purposes: The balance net proceeds will be used for strategic initiatives, strengthening marketing networks, and brand-building exercises. This utilization is capped at 15% of gross proceeds or ₹10 crore, whichever is lower.

Business Strengths

• Diverse Product Portfolio: The company manufactures a wide range of tarpaulin products serving multiple end-use industries, reducing dependence on any single sector.
• In-House Manufacturing: A fully integrated 1,98,450 sq. ft. facility enables streamlined inventory management, maintained production standards, and cost effectiveness.
• Experienced Management: The promoter group brings decades of industry expertise, with key leaders having between 9 and 17 years of experience.
• Established Client Relationships: Long-term domestic client relationships generate regular repeat orders, fostering loyalty and competitive advantage.

Key Risks

• Customer and Supplier Concentration: The top customer alone contributes 41.16% of total revenue, while the top supplier accounts for 55.87% of total purchases. Disruption in these relationships could materially impact operations.
• Geographic Concentration: 91.77% of revenue is derived from Madhya Pradesh, exposing the company to regional economic or political risks.
• Leased Facilities: Both the registered office and manufacturing unit are leased. Termination or non-renewal of leases could disrupt operations.
• Capacity Under-utilization: Capacity utilization was 64.64% in FY2023-24 and declined to 60.17% in FY2024-25. Inability to fully utilize capacity may affect returns on invested capital.
• Compliance History: The company has a history of delayed filings under GST, Income Tax, ESIC, and EPF regulations, with some delays extending up to 292 days.
• Environmental Regulations: Increasingly stringent regulations on plastic usage could impact manufacturing operations given the reliance on plastic raw materials.

Important IPO Dates

• IPO Opening Date: 15-Sep-2026
• IPO Closing Date: 17-Sep-2026
• Allotment Date: 18-Sep-2026
• Listing Date: 22-Sep-2026

Offer Details

• Issue Type: SME IPO
• Fresh Issue Amount: ₹20.88 crore
• Offer for Sale (OFS): Not Available
• Price Band: Not Available

Bottom Line

Shakti Polytarp presents a high-growth profile with revenue tripling over two years and improving profitability margins. The company aims to consolidate its position through capacity expansion funded by the ₹20.88 crore fresh issue. However, investors should note significant risks related to high customer and supplier concentration, heavy geographic reliance on Madhya Pradesh, and operational dependencies on leased facilities.