Varmora Granito

Founded in 2003, Varmora Granito has evolved into a prominent player in the Indian ceramic and vitrified tiles industry. Over more than two decades, the company has scaled its operations to include a vast product portfolio of over 3,500 distinct products, catering to various aesthetic and functional needs in construction and interior design.

The company's business model is strategically split between B2C and B2B channels. In the B2C segment, it leverages a robust network of 286 exclusive brand outlets (EBOs) and over 2,000 multi-brand outlets (MBOs) to reach end consumers. Simultaneously, its B2B arm focuses on direct partnerships with builders, contractors, developers, and government procurement agencies.

Operationally, Varmora Granito maintains a significant footprint in the Morbi industrial cluster of Gujarat, where it operates 9 manufacturing facilities. This concentration allows the company to optimize production and logistics within India's ceramic hub. The company's reach is extensive, with a presence in 949 cities across 27 states and union territories.

The promoters of the firm, Bhavesh Vallabhdas Varmora, Hiren R Varmora, and Pramodkumar Parsotambhai Patel, have steered the company toward a diversified product range including Glazed Vitrified Tiles (GVT), Polished Vitrified Tiles (PVT), and standard ceramic tiles, positioning the brand as a versatile choice in the tiling market.

Varmora Granito is launching a Mainboard IPO to raise approximately ₹708.02 crore. The issue is structured as a combination of a fresh issue of ₹320 crore and an Offer for Sale (OFS) of approximately 2,62,17,634 equity shares. The price band is set between ₹140 and ₹148 per share, with a minimum retail lot size of 101 shares costing ₹14,948. The IPO is scheduled to open on September 22, 2026, and close on September 24, 2026, with listing on the BSE and NSE on September 29, 2026.

The proceeds from the fresh issue are primarily earmarked for the repayment or pre-payment of outstanding borrowings and accrued interest for the company and its wholly-owned subsidiaries, including Covertek Ceramica Private Limited, Varmora Sanitarywares Private Limited, and Simola Tiles LLP, totaling ₹245 crore.

Financial performance shows a steady upward trend in revenue, growing from ₹1,472.58 crore in FY24 to ₹1,562.53 crore in FY26. Profitability has been more volatile, with PAT dipping to ₹30.77 crore in FY25 before rebounding strongly to ₹55.09 crore in FY26. The company reports a Basic EPS of ₹3.08 for FY26.

From a valuation perspective, the company's ROE (6.80%) and ROCE (9.89%) are relatively modest compared to industry leaders like Kajaria Ceramics. The high proportion of OFS (roughly 54.8% of the issue size) suggests that a significant portion of the proceeds is going to selling shareholders rather than into company growth, which may be viewed cautiously by investors.

Key strengths include a massive distribution network and a diverse product portfolio. However, risks include the cyclical nature of the real estate sector and the pressure of high competition in the Morbi cluster. Investors should weigh the strong revenue scale against the modest return ratios and current institutional demand levels.