SME IPO Alert: Sham Foam IPO Opens Today at Rs 130; PAT Jumps 142% YoY in FY26

On Tuesday, Indian equity benchmark indices traded lower, with the benchmark Nifty 50 index falling 136.25 points (0.55 per cent) to 24,447.55. Amid the broader market weakness, Sham Foam Limited opened its initial public offering for subscription today, becoming one of the latest entrants in the SME IPO space on the BSE SME platform.

Sham Foam IPO Opens Today at Rs 130 Per Share

Sham Foam Limited, a Haryana-based manufacturer of polyurethane (PU) foam and home comfort products, has launched its fixed price SME IPO with a total issue size of 31,14,000 shares aggregating to approximately Rs 40 crore. The issue is entirely a fresh issue with no offer for sale component, meaning the entire proceeds will flow directly into the company. The IPO closes on August 13, 2026, with allotment expected on August 14, 2026, and a tentative listing date of August 18, 2026, on the BSE SME platform.

Issue Structure and Reservation Details

The total issue of 31,14,000 shares is divided across investor categories as follows:

Retail and HNI investors are equally split, each receiving 50 per cent of the net offer. The market maker allocation of 1,56,000 shares has been allotted on a firm basis to JSK Securities & Services Pvt. Ltd.

Lot Size and Minimum Investment

IPO Timetable

Objects of the Issue

The company intends to utilise the net proceeds of Rs 35.01 crore as follows:

The largest allocation goes towards capacity expansion through civil construction and machinery procurement at its Ambala City facility, followed closely by working capital funding to support the company's growing order base.

Revenue Grows at 11.90 per cent CAGR; PAT More Than Doubles in FY2026

Sham Foam has reported consistent revenue growth over the three-year period from FY2024 to FY2026, with revenue from operations rising at a CAGR of approximately 11.90 per cent.

The most notable development in the financials is the sharp expansion in profitability. PAT more than doubled on a YoY basis in FY2026, rising 141.62 per cent from Rs 3.58 crore in FY2025 to Rs 8.65 crore in FY2026. PAT margin nearly doubled from 4.41 per cent to 9.37 per cent over the same period, pointing to meaningful improvement in operational efficiency and cost management.

About Sham Foam Limited

Sham Foam Limited, incorporated in 2020, is a vertically integrated manufacturer of PU foam, mattresses and allied home comfort products, operating from its manufacturing facility in Ambala City, Haryana. The facility spans 2,04,460 sq. ft. with an installed foam production capacity of 15,000 tonnes per annum. The company serves customers across 13 states through a pan-India network of over 1,300 dealers. Pre-issue promoter shareholding stood at 83,76,750 shares, which will dilute to a post-issue base of 1,14,90,750 shares.

Key Risks to Note

The company has disclosed several material risk factors in its DRHP. Outstanding litigation involving the company, promoters and directors totals Rs 536.42 lakh. Raw material costs constituted 78.75 per cent of revenue in FY2026, with the top 10 suppliers accounting for 78.56 per cent of purchases, creating meaningful supply concentration risk. The manufacturing facility operates on a 30-year lease running from August 2025 to July 2055, and non-renewal or adverse relocation terms could disrupt operations. The top 10 customers contributed 25.06 per cent of revenue in FY2026 with no long-term supply agreements in place. The company also reported negative net cash flow of Rs 1.05 crore in FY2025, though this recovered to a positive Rs 5.39 crore in FY2026.

IPO Management

Corporate Makers Capital Ltd. is the book-running lead manager for the issue. Alankit Assignments Ltd. has been appointed as the registrar. JSK Securities & Services Pvt. Ltd. is the designated market maker.
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Disclaimer: The article is for informational purposes only and not investment advice.