Nobel Hygiene Limited IPO

01At a glance

What the company does — makes and sells disposable hygiene products: adult diapers and underpads under Friends and B-Fit, baby diapers under Teddyy and Snuggy, and sanitary napkins under RIO (AP p.3).

Who pays it — consumers, through shops (55.47% of FY26 revenue), online channels (30.68%), and exports and private label (10.92%); it sells in 473 towns and exports to 19 countries (AP p.4, AP p.9).

Why it is raising money — ₹420 million to repay borrowings and ₹713.93 million, through a subsidiary, for a manufacturing-cum-warehousing building and an adult-diaper line at Halol, Gujarat; the rest for general purposes (AP p.6).

How fast it has grown — revenue from ₹7,285 million in FY24 to ₹8,468 million in FY26, most of it in FY26 (AP p.8).

The one thing to understand — a turnaround that depends on the adult-diaper business. The company lost ₹390 million in FY24, broke even in FY25 and earned ₹189 million in FY26, as product margin rose from 39.76% to 44.43%; adult products overtook baby products as the larger category (AP p.3, AP p.8, AP p.9).

02The business, in plain words

A diaper maker buys pulp, super-absorbent polymer and non-woven fabric, runs them through high-speed machines, and sells packs through shops and online. Margins depend on raw-material prices, the price the brand can hold against competitors, and how much it spends on distribution and advertising.

An elderly person's family needs incontinence products, or parents need baby diapers → they pick up Friends or Teddyy at a chemist, a shop or online → Nobel makes the diapers at its plants and ships through distributors and marketplaces → it earns the margin per pack.

The document calls the company India's largest home-grown branded maker of absorbent hygiene products by FY26 value among pure-play branded companies, per RedSeer (AP p.3). It reports one segment (AP p.3).

Earnings equation: Profit ≈ packs sold × product margin − distribution and advertising − overheads. Product margin was 44.43% of revenue in FY26 (AP p.9).

03Where the money comes from

Source: AP p.3, AP p.9.

Source: AP p.9.

The Friends and Teddyy brands together were 77.48% of FY26 revenue — 37.85% and 39.63% (AP p.10, our arithmetic).

04The growth record

Source: AP p.8, AP p.9.

Volume grew 10.00%, 8.00% and 18.57% in FY24, FY25 and FY26 (AP p.9).

05What the growth is made of

Volume, and a shift online. Volume grew faster than revenue in each year, so average price per unit fell slightly, but product margin still rose four points — which points to lower input costs or a better mix (AP p.9). Online sales nearly doubled their share, from 16.97% to 30.68% (AP p.9). Adult products grew 24% over two years while baby products grew 8% (AP p.3, our arithmetic).

06Earnings quality

Profit is new and small: ₹189.09 million on ₹8,467.50 million of revenue, a 2.23% margin (AP p.9). Operating cash flow was ₹711.34 million in FY26, 82.41% of EBITDA by the company's cash-conversion measure (AP p.8, AP p.9). Trade working capital was 22 days (AP p.9).

07The balance sheet

Source: AP p.8, AP p.9.

Equity grew by ₹1,911 million in FY25 and ₹925 million in FY26, far more than profits, so share issues paid down debt (AP p.8). Share capital rose from ₹127.92 million to ₹154.84 million in FY26 (AP p.8).

08What the money is for

Source: AP p.1, AP p.6.

The Halol spending goes through the subsidiary Nobel Hygiene Baroda (NHBPL) over FY27 and FY28 (AP p.6). A pre-IPO placement of up to ₹300 million may reduce the fresh issue (AP p.6). The offer is made under Regulation 6(2), as the company did not have an average operating profit of ₹150 million over the preceding three years (AP p.1).

09Who is selling

Source: AP p.1, AP p.2. The last row is our arithmetic from the total of 15,511,082; the two promoters offer five shares each.

10Promoters

The promoters are Kamal Kumar Johari, chairman and managing director and a chartered accountant, Kamini Kamal Johari, non-executive director, and the Kamal Kumar Johari HUF (AP p.5). Kamal Kumar Johari is also a partner in AIJ Infotech, Fancy Textrade, Powerful Impex and Mastermind JPIN Investment Managers (AP p.5).

11Who already owns it

Promoters hold 12.87% and the promoter group 21.27%, mostly through Fancy Textrade LLP (13.35%) and Powerful Impex LLP (7.75%) (AP p.7). Together that is 34.14%, our arithmetic. The rest is held by investors, including Orbit Investment Holdings and Sixth Sense India Opportunities III, and other shareholders (AP p.7).

12What changed just before the IPO

• Turnaround — from a ₹390 million loss in FY24 to a ₹189 million profit in FY26 (AP p.8).
• Deleveraging — borrowings cut from ₹3,683 million to ₹1,134 million through share issues (AP p.8).
• Online shift — online rose to 30.68% of revenue (AP p.9).

13Capacity and expansion

The proceeds pay for a brownfield manufacturing-cum-warehousing building and an adult-diaper line at the existing Halol site (AP p.6). The registered office is at Sinnar, Maharashtra (DRHP p.1).

14Market size and industry structure

The RedSeer report cited in the offer document says fewer than about 6% of Indians with severe incontinence use absorbent products, held back by awareness and stigma, and that baby diapers address about 113.10 million children (AP p.4, AP p.5). It expects adult-product growth to come mainly from new users (AP p.5). Those views are RedSeer's, and newboard has not tested them.

15Competitive position

What the document claims, and what it rests on:

• Largest home-grown branded maker of absorbent hygiene products by FY26 value among pure-play branded companies, per RedSeer (AP p.3).
• Leading adult brand — Friends is its largest brand after Teddyy (AP p.10).
• Broad reach — 473 towns and 19 export countries (AP p.4).

Against that: two brands carry most of revenue, and profit is recent and thin (AP p.9, AP p.10).

16Peers the company named

None. The document states there are no listed companies in India or abroad with a similar business (DRHP p.164). For Nobel it gives FY26 earnings per share of ₹2.46 basic and ₹2.45 diluted, net asset value per share of ₹46.50 and return on net worth of 5.08% (AP p.8). No P/E is possible for the company until a price band is set.

17Risks, in plain words

• Two brands. Friends and Teddyy are over three quarters of revenue (AP p.10).
• Thin profit. A 2.23% net margin leaves little room for raw-material price rises (AP p.9).
• Channel shift. Online selling brings platform fees and price competition (AP p.9).
• New capacity. The Halol line must fill with demand to pay back (AP p.6).
• History of losses. The company lost money in FY24 (AP p.8).

18Litigation and regulatory matters

The litigation summary was not read in detail for this study.

19Related-party transactions

Promoter-group LLPs — Fancy Textrade and Powerful Impex — hold 21.10% of the company (AP p.7). Transactions with them, if any, were 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:

• Why product margin rose four points — input costs, price or mix.
• Market share of Friends in adult diapers, in the pages read.
• Utilisation of existing plants before the new Halol line.
• The litigation position, which was not read here.
• The price band, lot size or issue dates, which is normal at DRHP stage.

21Five questions for management

1. How much of the margin improvement came from lower pulp and polymer prices?
2. What share of online revenue comes through the largest marketplace?
3. What utilisation does the Halol adult-diaper line need to cover its cost?
4. Why did volume grow 18.57% in FY26 while revenue grew 14.56%?
5. What did the FY25 and FY26 share issues raise, and from whom?

2Sources and cited facts

This study was read from 2 documents the company filed. The 37 figures it cites are listed under the document each came from, with the page and the sentence as printed.