Why:
- Execution: profit grew six-fold in two years on a plant that did not add one machine of capacity. Revenue went from ₹1,166 cr to ₹1,717 cr and profit from ₹30 cr to ₹193 cr (T1), all from filling idle capacity, and the order book has kept climbing since: up 64% at March 2026, then up another 31% in the June quarter to ₹1,778 cr, 1.8 times what it bills in a quarter (T1).
- Share: it dominates its home market the way few Indian machine makers dominate anything. Roughly 40% or more of India's woven-sack machinery market against about 7% for the next player (T3, from a study the company paid for), built on something harder to copy than price: over 101,000 of its looms already installed across ~100 countries, feeding a spares business worth 11% of revenue, a service network in 13 countries, and no customer above 2% of sales (T1).
- Margins: the next leg of growth needs almost no capital, and the offer priced it at 23 times FY26 profit. The main lines run at 32% to 50% of capacity, customers pay in advance (₹384 cr of advances at March 2026, double a year earlier), and each new rupee of revenue has been arriving at roughly 30% extra margin against a 20% average (T1). The cautions: this is a cyclical machine business near the top of its cycle in a market that halved once inside the last four years (T3), and the market has since pushed the price to about 28 times.
Valuation at the offer price
| Floor ₹404 (T1) | Cap ₹425 (T1) | |
|---|---|---|
| Bid window | 23 to 27 July 2026 | |
| Bid lot | 35 shares (T3) | |
| Fresh shares | none, pure offer for sale | |
| Shares outstanding after | 105,650,000 | |
| Market capitalisation | ₹4,268 cr | ₹4,490 cr |
| P/E on FY26 profit | 22.1x | 23.2x |
| EV/EBITDA | 12.9x | 13.6x |
| Promoter holding after | 50.9% |
The filing's five listed "peers" (P/E 18x to 134x) make different machines for different buyers, so the comparison means little; no listed Indian company does what Lohia does. The price never moves the verdict; the six ratings below judge the business, not the band.
The story
A buyer here is buying the machines behind woven plastic sacks: the dominant Indian maker of the looms and extrusion lines that turn plastic granules into cement bags, fertiliser sacks and bulk containers. The business is riding a powerful domestic upswing with a half-idle plant and a record order book, inside a world market that is small, cyclical, and already one-sixth Lohia's.
What this business is
Lohia Corp, from Kanpur, makes the full production line for woven plastic ("Raffia") fabric and sacks: tape extrusion lines that stretch plastic into tape, winders, circular looms that weave it, and the machines that coat, print and convert the fabric into bags. Customers are the roughly 1,500 small Indian converters, and thousands more abroad, who make the sacks that carry cement, fertiliser, grain and chemicals. It sells the whole plant, trains the operators, and then sells spares and service for the machine's 20-year life. Three machine families are 63% of revenue; spares are another 11% (T1).
Demand is its customers' capital spending, which makes this a cycle business: the Indian market halved between FY22 and FY24, then rebounded hard, and FY26's 25% growth was entirely domestic while exports fell 10% under US tariffs and Russia payment problems (T1/T2). The company sells mostly against advance payment, carries almost no debt, and spends about 2% of revenue on machinery of its own.
Easy or difficult business? Genuinely hard to enter: precision machine building with in-house motors and electronics, a global service network a 20-year asset demands, and an installed base that keeps customers coming back for spares. But not impossible: 20-plus Indian and 30-plus global players exist, and Chinese makers compete hard on price, with India's import-quality rules for these machines withdrawn in January 2026 (T2).
Key numbers
| ₹ cr | FY2024 | FY2025 | FY2026 |
|---|---|---|---|
| Revenue | 1,166 | 1,377 | 1,717 |
| Revenue growth % | n/a | 18.1 | 24.7 |
| Material margin % | 42.6 | 44.3 | 43.7 |
| EBITDA | 106 | 229 | 339 |
| EBITDA margin % | 9.0 | 16.5 | 19.5 |
| PAT | 30 | 118 | 193 |
| PAT growth % | n/a | 296.0 | 64.2 |
Profit grew far faster than revenue in both years, for different reasons: FY25 was a cost reset after the demerger year, FY26 was genuine volume leverage, with employee costs and overheads barely moving while revenue rose a quarter (T1). FY24 belongs to the pre-demerger business and was assembled by management for this filing, so the clean audited record is two years.
| Segment, ₹ cr | FY2024 | FY2025 | FY2026 |
|---|---|---|---|
| Circular looms | 345 | 434 | 571 |
| Circular looms growth % | n/a | 25.9 | 31.6 |
| Tape extrusion lines | 213 | 235 | 348 |
| Tape extrusion growth % | n/a | 10.1 | 48.4 |
| Tape winders | 109 | 116 | 154 |
| Tape winders growth % | n/a | 5.8 | 32.7 |
| Other machines | 240 | 283 | 292 |
| Other machines growth % | n/a | 17.8 | 3.4 |
| Spare parts | 139 | 174 | 195 |
| Spare parts growth % | n/a | 24.7 | 12.1 |
Scorecard
| Block | Rating | Why |
|---|---|---|
| Right to win | PASS | Customers pick Lohia because the whole ecosystem already runs on it: 101,000-plus looms installed, spares and engineers in 13 countries, a training centre that has taught the industry's operators since 2012, and machines built around 71 patented inventions (T1). That moat held through the last downturn: the company stayed profitable and cash-generating when its market halved. What it is not is unchallenged: Chinese makers price aggressively and India's import-quality order was withdrawn in January 2026, the export book changes its top five countries every year, and the "Lohia Group" name itself is licensed, revocably, from a promoter company (T1/T2). |
| Industry and TAM | MARGINAL | The world market for these machines is only about US$1 bn and Lohia already has roughly a sixth of it, with over half of India; near-term demand is strong, but beyond two or three years growth needs share taken from Starlinger and Chinese rivals, or new machine lines that are so far unproven (T3). |
| Financial momentum | PASS | Two years of strong, decomposed, capital-free growth with the order book and customer advances confirming more ahead; the cautions are that FY26's entire jump came from one geography in one year, and cash conversion leans on the advance build (T1). |
| Risks, governance, RPTs | PASS | No promoter loans, no pledges, related-party trade near 1% of revenue, litigation trivial; weighed against a young board, thin outside audit of the loss-making US arm, and a brand held outside the company (T1). |
| Promoter and cap table | MARGINAL | The two audited years show real delivery, but the record is only two years, never tested by a crisis, and the one big capital-allocation call visible, the US acquisition Leesona, is losing more each year with fresh parent money still going in; the family also took ₹1,396 cr off the table around listing while the company received nothing (T1). |
| Offer structure | PASS | A pure ₹1,101 cr offer for sale from a company that demonstrably needed no money: repaying all debt would add under 5% to profit and capex is covered seven times over internally. Promoters keep 50.9%, and the pre-IPO private sales went out at the same ₹425 the public paid (T1). |
Watch out for
- A quarter of growth is booked, not three years of it. The order book covers about nine months and machines deliver in six to nine, so everything past mid-FY27 depends on orders continuing to arrive. A new quality rule for cement sacks effective October 2026 may have pulled some orders forward; the first flat order-book quarter will tell (T1/T2).
- The US subsidiary Leesona is quietly failing. Losses tripled to ₹24 cr in FY26, its plant ran at 6% of capacity, its net worth is negative, and the parent has ₹41 cr of guarantees plus fresh loans behind it, with no write-down taken and no fix described (T1).
- January 2027 unlocks 55% of the shares at once. The lock-in on everything except the promoter's core 20% ends about six months after listing, above a family that has just sold 31% of the company (T1).
- FY26's domestic surge has no stated cause. The filing explains a 72% domestic jump in eleven words. Outside checks say it is real and continuing, but it is a return to a share level Lohia held three years ago in a market that took that share away once already (T1/T3).
The offer
- Raising ₹1,101 cr, all of it an offer for sale by seven members of the Lohia family; the company receives nothing (T1).
- For the sellers, not the business. Counting a ₹295 cr private placement at the same ₹425 days before the offer, the family sold 31% of the company for about ₹1,396 cr in one window; the chairman sold shares worth ₹711 cr and still owns 39.9% (T1).
- Implied valuation is in the table above: ₹4,268 cr to ₹4,490 cr at the band.
- How it went: subscribed 7.25 times, listed 30 July 2026 at ₹460 on NSE, 8% above the ₹425 offer price (T2). Listing performance is context only; it moves nothing in this note.
Assessed after listing from the final Prospectus dated 27 July 2026, the governing public document. Numbers carry source tiers: (T1) the filing's audited sections and exchange records, (T2) exchange or government data and established trade press, (T3) the issuer-commissioned industry study, news and secondary restatements. Load-bearing claims were checked against outside sources; the band and offer dates come from exchange records. Not a recommendation. The valuation section states what the offer price implied and is not a view on whether that price is right.