G. Surgiwear Limited IPO

01At a glance

What the company does: designs and manufactures surgical products, disposable drapes, dressings and apparel, and implantable devices such as hydrocephalus shunts, cranial fixation and orthopaedic implants, at one facility in Shahjahanpur, Uttar Pradesh, with 1,627 SKUs (DRHP p.26, DRHP p.145, DRHP p.223). It was incorporated in 1990 (DRHP p.1).

Who pays it: hospitals and healthcare providers, reached through 36 super-stockists and 554 distributors in India and 58 distributors abroad (DRHP p.41). The largest customer, the distributor H. Ramaniklal & Co., was 8.48% of FY25 revenue, and the top ten 27.15% (DRHP p.244). Exports were ₹109.33 million in FY25 (DRHP p.144).

Why it is raising money: ₹1,672.21 million for machinery to make hip and knee implants, ₹936.37 million to repay borrowings, and the rest for general purposes (DRHP p.27, DRHP p.130).

How fast it has grown: revenue from ₹1,509.48 million in FY23 to ₹2,239.76 million in FY25, and ₹446.13 million in the three months to June 2025 (DRHP p.29).

The one thing to understand: FY25 was an unusual year. Revenue from outside the distributor network, sales to the army and private hospitals, was ₹426.87 million, 19.06% of revenue, against ₹18.19 million in FY24 and ₹1.24 million in the three months to June 2025; disposable-dressings revenue rose by ₹445.85 million the same year; and EBITDA margin reached 44.19% before falling back to 32.03% (DRHP p.41, DRHP p.145, DRHP p.369). The pages read do not say whether the dressings growth and the direct sales are the same business.

02The business, in plain words

A surgical-products maker produces sterile disposables that hospitals use up in every operation, and implants that surgeons place in patients, and sells them through regional stockists to hospitals and clinics.

A hospital schedules a week of surgeries → it orders sterile drapes, dressings and a shunt from a local distributor → the distributor restocks from a G. Surgiwear super-stockist → the company made the products at Shahjahanpur and is paid by the stockist.

The company has an in-house R&D unit recognised by the Department of Scientific and Industrial Research, and holds exclusive rights to use 31 Indian and eight international patents (DRHP p.223).

Earnings equation: Profit ≈ units sold × (price − materials and conversion cost) − staff cost − interest. Raw materials were 21.45% of revenue in FY25, and employee costs ₹536.40 million (DRHP p.370).

03Where the money comes from

Source: DRHP p.223. Bone cement and other items make up the rest. Q1 FY26 is three months.

Source: DRHP p.41.

04The growth record

Source: DRHP p.29, DRHP p.144, DRHP p.145, DRHP p.375. Q1 FY26 is three months.

Our arithmetic: revenue grew about 21.8% a year from FY23 to FY25 and profit after tax about 106.9% a year (our arithmetic, DRHP p.144). The offer document puts return on capital employed at 16.34% in FY23, 17.90% in FY24 and 29.66% in FY25, and net working capital at 123, 124 and 135 days; net debt of ₹927.81 million at March 2025 was 0.9 times FY25 EBITDA (DRHP p.145, our arithmetic).

05What the growth is made of

FY25's growth came mostly from dressings. Revenue rose ₹552.40 million, of which dressings contributed ₹445.85 million, about 81% (our arithmetic, DRHP p.369). The document describes the dressings increase as "approximately 26.42% of the revenue growth"; 26.42% is the increase as a share of FY24 revenue (our arithmetic, DRHP p.369). Dressings revenue in the three months to June 2025 was ₹53.32 million, against a quarterly average of ₹156.89 million in FY25 (our arithmetic, DRHP p.223).

06Earnings quality

Profit rose 157.60% in FY25 as raw-material costs fell to 21.45% of revenue from 25.57% and the tax rate fell to 23.98% from 31.52% (DRHP p.370, DRHP p.371). Operating cash flow was strong in FY24 and FY25 but ₹9.30 million in the three months to June 2025, when net working capital days reached 149 (DRHP p.145, DRHP p.375). There are no auditor qualifications that have not been given effect in the restated accounts (DRHP p.29).

07The balance sheet

Source: DRHP p.29, DRHP p.145.

The company spent ₹1,567.90 million on investing activities from FY23 to June 2025, funded by operating cash and borrowings (our arithmetic, DRHP p.375). Cash was ₹3.01 million at June 2025 (DRHP p.375). The company has guaranteed ₹207.50 million of State Bank of India credit facilities of Nenimemi Food Private Limited, a related party (DRHP p.31).

08What the money is for

Source: DRHP p.27.

The machinery includes an Arcam EBM Spectra L system, a high-temperature furnace and a hot isostatic press, and the amount includes ₹79.63 million of contingency (DRHP p.131).

09Who is selling

Source: DRHP p.26, DRHP p.27.

10Promoters

The promoters are Ghanshyam Das Agarwal, Renu Agarwal, Vinamra Agarwal, Rishu Agarwal and Ghanshyam Das Agarwal HUF (DRHP p.26). Ghanshyam Das Agarwal was paid ₹48.00 million a year as key managerial personnel, and Renu Agarwal, Vinamra Agarwal and Rishu Agarwal ₹19.80 million each (DRHP p.32). Renu Agarwal is a director of Nenimemi Food Private Limited, whose borrowings the company guarantees (DRHP p.31, DRHP p.265).

11Who already owns it

Source: DRHP p.27, DRHP p.28. Promoters and promoter group hold 92.96% (DRHP p.28).

12What changed just before the IPO

• Bonus issue: 40 bonus shares for each share held, allotted on 10 December 2025, taking the share count to 54,126,560 (DRHP p.105).
• Margins: EBITDA margin down from 44.19% in FY25 to 32.03% in the quarter (DRHP p.145).
• Direct sales: sales outside the distributor network fell from ₹426.87 million in FY25 to ₹1.24 million in the quarter (DRHP p.41).
• Borrowings: up ₹280.73 million in the quarter (our arithmetic, DRHP p.29).
• Last allotment: the bonus shares of 10 December 2025, at nil consideration, were the last allotment before the offer (DRHP p.105).
• Auditor: Raj Agarwal & Co. was appointed statutory auditor on 30 September 2025 for a term of five years (DRHP p.93).
• Public company: converted from a private limited company in March 1995 (DRHP p.3).
• Outside holder: R.M. Financial Services Limited held 5.68% before the offer, the only holder of 1% or more that is not a promoter or a promoter-group individual (DRHP p.123).

13Capacity and expansion

One manufacturing facility at Shahjahanpur (DRHP p.30). In FY25, utilisation was 77.88% for drapes, 82.77% for dressings, 88.27% for andrology and shunt, 90.13% for cranial fixation and 49.60% for apparel (DRHP p.238). The proceeds fund machinery for hip and knee implants at the same facility (DRHP p.130).

14Market size and industry structure

The 1Lattice report cited in the offer document values India's surgical-disposables market at US$3.9 billion in FY25 and the implant market at US$7.2 billion, and projects the implant market at US$10.6 billion by FY30 (DRHP p.26). Those projections are 1Lattice's, and newboard has not tested them. The report also says the company had the highest FY25 revenue among its Indian peers (DRHP p.26).

15Competitive position

What the document claims, and what it rests on:

• Scale among Indian peers, citing 1Lattice (DRHP p.26).
• Patents and R&D: rights to 31 Indian patents and a recognised R&D unit; the first Indian maker of zirconia-toughened alumina ceramic hip components, citing 1Lattice (DRHP p.223).
• A distribution network across 23 states and union territories (DRHP p.41).

Against that: one plant, three product categories for about 80% of revenue, pricing pressure from distributors and hospitals, and quality and regulatory risk (DRHP p.30, DRHP p.42).

16Peers the company named

Source: DRHP p.144. Peer P/E uses prices on 24 December 2025. The table heads the revenue column "fiscal 2024" while its notes say FY25. It gives G. Surgiwear's net asset value per share as ₹1,448.66, on the share count before the December 2025 bonus issue (DRHP p.144, DRHP p.29).

No P/E is possible for the company until a price band is set.

17Risks, in plain words

• Quality. Surgical and implant products face strict standards (DRHP p.30).
• One plant. All manufacturing at Shahjahanpur (DRHP p.30).
• Distributors. Almost all sales go through stockists and distributors (DRHP p.41).
• Product concentration. Drapes, andrology and shunt, and dressings are about 80% of revenue (DRHP p.42).
• Pricing. Pressure from distributors and hospitals (DRHP p.30).
• Guarantee. ₹207.50 million for a related food company's bank loans (DRHP p.31).

18Litigation and regulatory matters

Source: DRHP p.29, DRHP p.30. An income-tax demand of ₹69.25 million for assessment years 2013-14 to 2021-22 is under appeal (DRHP p.31).

19Related-party transactions

Promoter remuneration is shown in section 09. The company guarantees ₹207.50 million of State Bank of India facilities for Nenimemi Food Private Limited, a related party (DRHP p.31). The rest was not read in detail for this study.

20What the offer document does not say

In the sections read for this study, the document does not give:

• Who bought the ₹426.87 million of FY25 direct sales, beyond "the army and private hospitals", or whether the orders recur.
• Whether the FY25 dressings jump is the same business as those direct sales.
• Why the company guarantees a related food company's bank loans, or on what terms.
• What the criminal proceeding against the company concerns, in the pages read.
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. Who were the FY25 army and private-hospital customers, what did they order, and is there repeat business?
2. What explains the FY25 EBITDA margin of 44%, and what margin is normal for the business?
3. Why does the company guarantee ₹207.50 million of Nenimemi Food's bank loans, and when will the guarantee end?
4. What demand does the company expect for the hip and knee implants the new machinery will make?
5. Why did operating cash flow fall to ₹9 million in the June 2025 quarter?

1Sources and cited facts

This study was read from 1 document the company filed. The 59 figures it cites are listed under the document each came from, with the page and the sentence as printed.