Nitin Spinners

Textile stocks have no fancy on the bourses, given the down-in-the-dump state of the sector. This is a mid-sized textile company, making cotton yarn and knitted fabric. The company recently completed expansion at a cost of Rs.281 crore, with a capacity of 72,480 spindles and 18 knitting machines.

The company posted a good set of numbers for Q4FY15, driven by a good growth in topline though margins show some pressure. Net sales for the quarter rose 34% (YoY) at Rs.188 crore. Costs were at 88% of net sales compared to 87%. EBITDA was 41% higher at Rs.31 crore but margins showed some pressure – down from 18.03% to 16.49%. It ended the quarter with a net profit of Rs.12 crore, up 50%. NPM came lower at 6.38% v/s 6.56%. It ended FY15 with a 17% rise in net profit at Rs.41 crore.

The company’s debt (long term borrowing + short term borrowing) stands at Rs.337 crore, up from Rs.144 crore in FY14 and consequently, interest outgo has risen 35%.