Monday, April 22, 2024
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HomeStocksTop 3 Profitable Companies in Indian Textile Space

Top 3 Profitable Companies in Indian Textile Space

The Indian textile industry is among the oldest industries in the country dating back several centuries. India stands as the world’s second-largest textiles and garments producer and ranks fifth among textile exporters encompassing apparel, home, and technical goods. This sector contributes 2.3% to India’s GDP, 13% to its industrial output, and fuels 12% of its exports.

A workforce of about 45 million individuals is engaged in the textile industry, with 3.5 million dedicated to handloom work. Projections indicate a 10% Compound Annual Growth Rate (CAGR) for the Indian textile and apparel industry from 2019-20, reaching a value of US$ 190 billion by 2025-26. As of 2020, the Indian apparel market was valued at US$ 40 billion and is predicted to elevate to US$ 135 billion by 2025.

India benefits from a competitive edge due to its adept workforce and cost-efficient production in comparison to other prominent textile manufacturers.

In this article, we are going to explore the three most profitable textile companies in India.

Vardhman Textiles Limited

It is engaged in the business of manufacturing Yarn, Fabric, Acrylic Fiber, and Garments. Over the years, the group has developed into a business conglomerate with a presence in India and in 75 countries across the globe.

In the June quarter of FY24, Company’s revenue from operations experienced a decrease of 18% YoY, going from Rs 2812 crore to Rs 2318 crore. The operating profit of the company fell from Rs 526 crore to Rs 215 crore and on a sequential basis it declined from Rs 262 crore to Rs 215 crore, the operating profit margin stood at 9%. The net profit of the company amounts to Rs 137 crore against Rs 333 crore. The net profit in FY23 stood at Rs 804 crore. The shares of the company closed at Rs 368 each on the BSE and have generated a return of 10% in the last year.

Raymond Limited

It is a multifaceted conglomerate with investments spanning the Textile and Apparel domains both nationally and internationally. It boasts a comprehensive retail footprint of 1,638 outlets, comprising 1,589 establishments dispersed across approximately 600 towns and cities within India, and an additional 49 stores situated across nine different countries abroad.

In the June quarter of FY24, the Company’s revenue from operations experienced a modest increase of 2.5% YoY, going from Rs 1728 crore to Rs 1771 crore. The operating profit of the company fell from Rs 208 crore to Rs 197 crore and on a sequential basis it declined from Rs 337 crore to Rs 197 crore, the operating profit margin stood at 11%. The net profit of the company amounts to Rs 1067 crore against Rs 82 crore. The net profit in FY23 stood at Rs 537 crore. The shares of the company closed at Rs 1953 each on the BSE and have generated a return of 100% in the last year.

Trident Limited

Headquartered in India, operates in the manufacturing, trading, and sale of Textiles (including Yarn, Terry Towels, and Bedsheets) and Paper & Chemicals. The company functions through two distinct segments: Textiles and Paper and Chemicals. Within the Textile segment, activities encompass yarn production, towel manufacturing, bedsheet production, and dyed yarn manufacturing, including utility services.

In the June quarter of FY24, Company’s revenue from operations experienced a decrease of 11% YoY, going from Rs 1680 crore to Rs 1494 crore. The operating profit of the company fell from Rs 262 crore to Rs 231 crore and on a sequential basis it declined from Rs 269 crore to Rs 231 crore, the operating profit margin stood at 15%. The net profit of the company amounts to Rs 91 crore against Rs 129 crore. The net profit in FY23 stood at Rs 442 crore. The shares of the company closed at Rs 35.68 each on the BSE and have generated a negative return of 7% in the last year.

The festive season is approaching, and investors should keep an eye on textile stocks for potential investment opportunities.

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