Sri Vishnu Shankar Mills Growth

The revenue of the company grew by 48.34% in FY22. The major driver of this growth is :

a) The lower opening stock, coupled with a lower production estimate of cotton during the current cotton crop season has pushed up the cotton prices in an upward trend. The cotton price has increased from Rs. 60,000/- to more than Rs. 1,00,000/- per candy within a period of 6 months from the beginning of the cotton season. 

b) The company's focus on new product development, innovation, and cost-effective production have led to an increase in the company's revenue.

c) The yarn market in India has bounced back after witnessing a slowdown in the last 2 years. Geopolitical factors like the banning of imports from China by the United States and disruption in the supply of textiles and apparel products to countries across the world by China due to shortage of electricity in their country boosted the demand for textile products including yarn manufactured in India.

The Government of India has imposed a duty on all varieties of imported cotton during February 2021 and this made imported cotton dearer by 11% for Indian Spinning Mills. However, the Government of India has withdrawn the import duty effective 14th April 2022 till 30th September 2022. 

The net profit of the company registered a growth of 181% in FY22 as against FY21. The main reason for the same was followed by an increase in the company's revenue due to an increase in demand for yarn products. The company procured high-quality imported cotton when the prices were at a reasonable level. This strategy has helped the company to quote competitive prices for our yarn, which helped to improve the profit margin in the financial year 2021–22. The company was also able to save on interest costs in spite of additional borrowings due to various measures announced by the RBI to reduce interest costs.

During FY22, the company was able to consume power from its own wind farms to the extent of 51% (PY: 60%) of the total power requirement. The power cost has increased during the financial year 2021-22 to Rs. 17.08 Crores vis-a-vis Rs.12.49 Crores incurred during previous year, 

The company reported EPS growth from Rs.120.71 in FY21 to Rs.223 in FY22, which is 84.74% year-on-year (y-o-y) growth on account of increase in net profit after tax .

In FY22, the company's book value grew by 13.11% because of an increase in retained earnings of the company.

In FY22, EBIDTA of the company grew by 55.16% as against FY21 as the revenue of the company increased by 48.34% in FY22, due to higher price realization of cotton and yarn. Geopolitical factors boosted the demand for textile products including yarn manufactured in India.

In FY22, the assets grew by 40.62% as against FY21. The current assets of the company grew by 85%, whereas the non-current assets grew by 22%. The inventory increased by a significant difference as they were able to procure a huge quantity of raw material at reasonable rates and the receivables increased on account of an increase in business operating activities. A notable increase of 51% can be seen in plants and machinery as the company installed a number of fully automatic machines at its manufacturing plant.

In FY22, the cash flow from operations of the company decreased by Rs. 29.61 Cr. The cash flow from operations decreased as the company spent Rs. 59.39 Cr in FY22 on the procurement and processing of inventories and the loans and advances of the company increased by Rs. 16.98 Cr .