Riyaasat Lifestyle Ltd IPO

The company offers customisation beyond standard size alterations, allowing customers to modify garment styles, designs, and embroidery based on their preferences. It also provides coordinated outfits for entire families, including children, which differentiates it from many ethnic wear retailers that primarily offer standardised collections.

Riyaasat Lifestyle operates through a combination of manufacturing, trading, and retailing activities. The company generated manufacturing revenue of Rs 7.13 crore and trading revenue of Rs 20.74 crore during the 10 months ended January 31, 2026, giving it a diversified operating model within the ethnic wear segment.

As of January 31, 2026, the company operated six exclusive brand outlets across Ahmedabad, Vadodara, and Mumbai. Its retail footprint includes a company-owned showroom in Santacruz, Mumbai, alongside multiple leased outlets in key commercial locations in Gujarat.

The company claims to have a workshop equipped with automated and semi-automated machinery that supports garment production and customisation. According to the prospectus, the facility is designed to improve production efficiency and precision while supporting changing fashion requirements.

The company sources fabrics and other materials from a broad supplier network spread across Gujarat, Uttar Pradesh, Maharashtra, Karnataka, Delhi, West Bengal, and Haryana. This sourcing network includes weavers, traders, and fabric suppliers, helping the company access a variety of materials used in ethnic and Indo-Western apparel.

The company’s product portfolio spans multiple categories across men’s and women’s ethnic wear. Its major revenue-generating products include sherwanis, lehenga cholis, Indo-Western outfits, kurta sets, jodhpuris, sarees, gowns, and suits, allowing it to cater to wedding, festive, and ceremonial wear segments.

The company has expanded its physical retail network from its first exclusive brand outlet launched in October 2021 to six outlets by January 2026. During the nine months ended January 31, 2026, its two highest-performing stores in Ahmedabad and Mumbai together contributed approximately 54.76% of revenue from operations.

The company’s revenue has grown over the last three financial years. Revenue from operations increased from Rs 20.93 crore in FY23 to Rs 22.87 crore in FY24 and Rs 24.80 crore in FY25, while profit after tax increased from Rs 1.32 crore to Rs 4.08 crore and Rs 4.87 crore during the same period.

The company’s revenue is significantly dependent on a few product categories. Its top four products are lehenga choli, sherwani, Indo-Western wear, and kurta sets, which contributed Rs 16.77 crore (60.18%), Rs 16.67 crore (67.18%), Rs 14.69 crore (64.20%), and Rs 13.27 crore (63.39%) of revenue from operations in the period ended January 31, 2026, and FY25, FY24, and FY23, respectively. Should the demand for these products decline, fashion trends change, or consumer preferences shift, it could adversely affect the company’s business, financial condition, and results of operations.

The company relies on third-party job workers for key manufacturing activities such as cutting, embroidery, stitching, and finishing of garments. Job work expenses amounted to Rs 2.53 crore (11.01% of total expenses), Rs 2.06 crore (10.66%), Rs 2.22 crore (12.15%), and Rs 0.26 crore (1.36%) in the period ended January 31, 2026, and FY25, FY24, and FY23, respectively. If the company is unable to retain these workers, engage additional workers during periods of high demand, or maintain consistent production quality and efficiency, it could adversely affect the company’s operations and financial performance.

The company depends on third-party suppliers and vendors for sourcing raw materials and carrying out various production-related activities. Its top 10 suppliers accounted for purchases worth Rs 6.15 crore (28.32%), Rs 4.45 crore (37.23%), Rs 5.10 crore (32.90%), and Rs 7.70 crore (50.68%) in the period ended January 31, 2026, and FY25, FY24, and FY23, respectively. Any failure to maintain relationships with these suppliers, disruptions in supply, deterioration in product quality, or increases in procurement costs could adversely affect the company’s operations, profit margins, and financial condition.

The company’s revenue is heavily concentrated in western India, particularly Gujarat. Gujarat contributed Rs 18.71 crore (67.13%), Rs 23.96 crore (96.59%), Rs 22.40 crore (97.90%), and Rs 20.93 crore (100.00%) of revenue from operations in the period ended January 31, 2026, and FY25, FY24, and FY23, respectively. Any adverse economic, social, political, or regulatory developments in Gujarat or the western region could adversely affect the company’s business, operations, and financial performance.

The company’s business is subject to seasonal fluctuations, with demand for its ethnic wear products being significantly higher during festive occasions and wedding seasons. As a result, a substantial portion of its revenue is generated during specific periods of the year, making its financial performance dependent on consumer spending during these peak seasons. Any disruption to wedding or festive demand due to economic slowdowns, changes in consumer spending patterns, adverse weather conditions, or regulatory restrictions could adversely affect the company’s revenue, cash flows, and financial condition.

The company has reported negative cash flows from operating activities of Rs 2.73 crore, Rs 2.73 crore, and Rs 1.12 crore in the period ended January 31, 2026, FY24, and FY23, respectively, primarily due to higher inventory levels and an increase in short-term loans and advances. It also reported negative cash flows from investing activities of Rs 25.26 crore, Rs 6.50 crore, Rs 0.41 crore, and Rs 0.39 crore during the period ended January 31, 2026, and FY25, FY24, and FY23, respectively, largely on account of investments in fixed assets and other non-current assets. The increasing working capital requirements associated with business growth have made inventory funding and credit facilities more important for the company’s operations. Investors should keep an eye on this metric. If cash outflows continue to exceed inflows or working capital requirements rise faster than expected, the company may face liquidity pressures that could adversely affect its business, growth plans, and financial condition.

The company, its directors, promoters, key managerial personnel, and senior management are involved in certain ongoing legal proceedings. Any adverse outcome in these matters could result in financial liabilities, reputational damage, or regulatory actions, which may adversely affect the company’s business, results of operations, and financial condition.

The company operates in the highly competitive ethnic wear market, where it faces competition from established national brands, regional players, and unorganised retailers. If the company is unable to differentiate its products, maintain pricing competitiveness, or adapt to changing consumer preferences, it could hurt its market position, revenue, and profitability.

As of January 31, 2026, the company had total outstanding borrowings of Rs 38.97 crore, comprising secured borrowings of Rs 33.37 crore and unsecured borrowings of Rs 5.60 crore. A significant portion of these borrowings has been availed for working capital requirements and business expansion. Any failure to service or repay these loans on time, comply with financing covenants, or secure additional funding when required could adversely affect the company’s business, cash flows, and financial condition.