RATING

RECOMMENDATION

Sell

  • ROFR Required
  • Available in Depository:

  • NSDL

  • CDSL

  • Available for Investment:

  • Primary

  • Secondary

RATING

RECOMMENDATION

Sell

Business Type

Traditional Business

RATING

RECOMMENDATION

Sell

Business Type

Traditional Business

  • Sri Vishnu Shankar Mills Growth

Sri Vishnu Shankar Mills Revenue Growth

Growth in %

  • 48.34%

    1 Year

  • 8.63%

    3 Year

  • 6.72%

    5 Year

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 However, the Government of India has withdrawn the import duty effective 14th April 2022 till 30th September 2022. 

Sri Vishnu Shankar Mills Net Profit Growth(PAT)

Growth in %

  • 180.60%

    1 Year

  • 50.35%

    3 Year

  • 60.67%

    5 Year

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, 


Sri Vishnu Shankar Mills EPS Growth

Growth in %

  • 84.74%

    1 Year

  • 32.76%

    3 Year

  • 19.55%

    5 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 .

  • Sri Vishnu Shankar Mills Book Value Growth

Growth in %

  • 13.11%

    1 Year

  • 7.19%

    3 Year

  • 6.61%

    5 Year

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

Sri Vishnu Shankar Mills EBITDA Growth

Growth in %

  • 55.16%

    1 Year

  • 11.65%

    3 Year

  • 10.44%

    5 Year

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.

Sri Vishnu Shankar Mills Operating Profit Growth

Growth in %

  • 87.78%

    1 Year

  • 27.73%

    3 Year

  • 12.90%

    5 Year

 

Sri Vishnu Shankar Mills Asset Growth

Growth in %

  • 40.62%

    1 Year

  • 10.17%

    3 Year

  • 5.60%

    5 Year

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.

Sri Vishnu Shankar Mills Cash Flow from Operations

Growth in %

  • NA

    1 Year

  • NA

    3 Year

  • NA

    5 Year

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 .

  • Sri Vishnu Shankar Mills Solvency Ratios

Sri Vishnu Shankar Mills D/E Ratio

The company took additional borrowings for the modernization and expansion projects. The company installed new machines, which helped the company achieve more production with lower operating and labor costs. In spite of the increase in the company's equity, the debt-equity ratio of the company increased as the company's debt increased more in proportion to its equity.

Sri Vishnu Shankar Mills Current Ratio

In FY22, the company's current ratio increased by 19.4% y-o-y. The company was able to procure raw materials at reasonable rates, which led to an increase in inventories , business operations and hence current assets of the company by 85% in FY22. The company took additional borrowings in order to facilitate expansion projects, which led to an increase in current liabilities by 79% y-o-y in FY22. Overall, taking into consideration other current assets and other current liabilities, current assets increased more than current liabilities, leading to an increase in the current ratio of the company.

Sri Vishnu Shankar Mills Quick Ratio


Sri Vishnu Shankar Mills Interest Coverage Ratio

The interest coverage ratio increased by 104.5%. The company was able to control its interest expense even after additional borrowings because of favourable interest rates, whereas the EBIT of the company increased because of an increase in the revenue of the company, which overall led to an increase in the interest coverage ratio of the company.

  • Sri Vishnu Shankar Mills Operating Efficiency

Because of the increase in its revenue, the company was able to strengthen its operating efficiency. The major driver of this growth was the increase in sales of yarn by the company. Due to geopolitical factors like banning of imports from China by United States and disruption in 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 EBIT Margin increased by 16.18%, the PBT Margin by 145.89%, and the PAT Margin by 73.41%.

Sri Vishnu Shankar Mills Operating Profit EBIT Margin(OPM)

Sri Vishnu Shankar Mills Profit Before Tax Margin (PBT Margin)

Sri Vishnu Shankar Mills Profit After Tax Margin (PAT Margin)

  • Sri Vishnu Shankar Mills Profitablity Ratio

Sri Vishnu Shankar Mills Return on Equity(RoE)

Due to the firm's increasing net profit in FY22, the ROE of the company increased by 148.08% y-o-y. As per DU Point analysis, the company's net profit margin increased by 73.6% y-o-y in FY22, which is a major factor in the increase. The asset turnover of the company increased because of the increase in revenue. This all led to an increase in the return on equity (ROE) of the company.

Sri Vishnu Shankar Mills Return on Capital Employed(RoCE)

Sri Vishnu Shankar Mills Return to Assets (RoA)

In FY22, the net profit of the company increased by 181%, whereas the assets increased by 21.9% due to the installation of new machinery. This has overall led to a 130.3% increase in the return of assets of the company.

  • Sri Vishnu Shankar Mills Valuation Ratios

Sri Vishnu Shankar Mills Earning Yield