Vardhman Textiles Q4 Results Review - Healthy Operating Performance, Inline With Estimates: Systematix

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Research Report.Vardhman Textiles Ltd.’s reported a strong Q4, marked by healthy Ebitda (inline with estimates) and Ebitda margins surpassing estimates. Q4 revenue fell marginally by 1% YoY and grew 6% QoQ to Rs 24.6 billion (8% lower than our estimate). Sales volumes in yarn/grey/processed fabric grew by 5%/20%/24% YoY, respectively, on improving demand momentum. Gross margin expanded 471 bps YoY and 32 bps QoQ to 43.2% (estimated at 43%) on soft raw material prices and inventory gains. Ebitda reported double-digit growth of 18% YoY and 26% QoQ to Rs 3.1 billion, inline with our estimate. Ebitda margin expanded 199 bps YoY and 205 bps QoQ to 12.5% (above our estimate of 11.6%). Finance cost declined 6% YoY but increased 47% QoQ to Rs 285 million. Depreciation fell 7% YoY and 3% QoQ to Rs 968 million. Other income fell 11% YoY and 10% QoQ to Rs 672 million. Adjusted profit after tax grew 26% YoY and 25% QoQ to Rs 2 billion (in line). Consequently, APAT margin expanded 177 bps YoY and 128 bps QoQ to 8.2% (estimated at 7.5%). Management said demand for yarn and fabric in the domestic as well as export markets has improved over the last few quarters and expects the momentum to sustain. Normalisation of channel inventory and supply chain are supporting the improving demand..To cater to the rising demand, management is strategically focused on enhancing and modernising its existing capacities and operational efficiencies. In addition to the Rs 2 billion expansion announced in Feb 2024, it has planned a capex of Rs 20 billion, which it expects to complete by FY26..Click on the attachment to read the full report:va.Five-Star Business Finance - Enabling Small; Growing Big; Motilal Oswal Initiates Coverage With A Buy.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Vardhman Textiles Q4 Results Review - Healthy Operating Performance, Inline With Estimates: Systematix

Management is optimistic on the demand scenario for the upcoming quarters and anticipates better margins with better spreads and improving capacity utilization levels

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Vardhman Textiles Q4 Results Review - Healthy Operating Performance, Inline With Estimates: Systematix

Management is optimistic on the demand scenario for the upcoming quarters and anticipates better margins with better spreads and improving capacity utilization levels

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