Tag: Welspun India

Welspun India shares dip 9%; Nuvama says risk-reward unfavourable at this valuation

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Welspun India Ltd tumbled over 9% in Thursday’s (October 26) trade, a day after rallying 13% to hit a 52-week high of ₹143.95 on better-than-expected second-quarter earnings. Welspun India’s risk-reward stays unfavourable after a 73% rally on the counter since the beginning of this year, said Nuvama Institutional Equities in a report.

Nuvama has maintained a ‘Hold’ rating on the stock even as the brokerage has upped its target price on Welspun India to ₹148 from ₹110 earlier. This indicates a further upside of 15% from the current market levels.

The scrip was trading 9.49% lower at ₹128.70 apiece on the NSE today. It is trading at 8 times two-year blended forward EV/Ebitda, which is well above its long-term average of 5.5 times.

With global demand reviving and cotton prices normalising, Nuvama expects margins to improve further. “This gives us the comfort to hike the target valuation to 8 times (from 6 times).”

“While we are edging up FY25 EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) by 3% on improving demand, risk-reward stays unfavourable at this valuation,” the brokerage said.

Welspun India’s management has guided for 10–12% sales growth each in FY24 and 25 with potential EBITDA margins of 15%. Upcoming festive demand backed with stable cotton prices should keep margins intact, Nuvama said.

The brokerage said that net debt for Welspun India declined to ₹1,600 crore in Q2 from ₹1,800 crore as of June 2023. Net debt to equity stood at 0.4 times in Q2.

Welspun said its Q2 profit came in at ₹196.7 crore, up more than 22 times on a year-on-year (YoY) basis. Total revenue for the September quarter climbed 19% YoY to Rs 2,542.4 crore.

“It is a proud moment for the company to have reported highest ever consolidated quarterly revenues in Q2 FY24 with consistent profitability in last few quarters, in the face of relatively adverse global economic situation and subdued consumer sentiments. It is also heartening to see the flooring business picking up well and reporting highest quarterly revenues and margin,” said Welspun Group chairman BK Goenka.

On the domestic front, Welspun showed resilience during the quarter despite weak retail market sentiments, as a result of focus on continued expansion and also continued to be in positive margin space, Goenka added.

Separately, Welspun has appointed Murali Sivaraman as an independent director for a four-year term.

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Welspun India net profit increases multi-fold to Rs 162.73 cr in Q1

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Home textiles major Welspun India Ltd on Monday reported a multi-fold rise in its consolidated net profit to Rs 162.73 crore for the first quarter ended June 2023, helped by higher margins.

The company had posted a consolidated net profit of Rs 21.36 crore in the April-June quarter last fiscal, Welspun India said in a regulatory filing.

Its revenue from operations rose 11.58 percent to Rs 2,184.05 crore during the quarter under review. It was Rs 1,957.25 crore in the year-ago period.

Welspun Group Chairman BK Goenka said: “In Q1 FY24 with sequentially higher margins, continuing the trend since last few quarters, delivering highest EBITDA margin in last seven quarters. It is also heartening to see the Flooring business post its highest revenues during the quarter”.

Its revenue from the Home Textiles segment was Rs 2,037.60 crore, while the flooring business stood at Rs 225.09 crore in the first quarter of FY 2023-24. Its “flooring business grew 33 percent year-on-year to record the highest revenue ever of Rs 225.1 crore,” it said.

Welspun India’s total expenses increased 2.88 percent to Rs 1,998.65 crore in the June quarter.

Its “net debt stood at Rs 1,815.3 crore as of 30th June 2023 vs Rs 1,534.3 crore as on 31st March 2023. During Q1 FY 24 the Company paid out of Rs 240 crore (incl tax of Rs 45 crore) towards buyback,” said an earning statement of Welspun India.

Shares of Welspun India Ltd on Monday settled at Rs 109.71 on BSE, up 9.37 per cent from the previous close.

ALSO READ: Bosch Q1 Results | Net profit rises 22% to Rs 409 crore, revenue up 17% to Rs 4,158 crore

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Welspun India shares gain most in nearly a year after buyback announcement, earnings

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Welspun India Ltd. rallied over 12 percent in trade on Tuesday after the home textiles company announced a buyback offer along with its earnings for the March quarter.

Over the weekend, Welspun India’s board of directors approved a buyback proposal worth Rs 195 crore. Under the offer, the company would buyback up to 1.62 crore shares at a price of Rs 120 apiece, which translates into a premium of 36.7 percent on Friday’s closing price of Rs 87.75 per share.

The buyback will be carried out via the Tender Offer route and the record date for the same has been set as May 10 to ascertain the eligibility of shareholders for the buyback.

For the March quarter, Welspun India reported a revenue growth of 15 percent year-on-year to Rs 2,154 crore, while operating profit, or EBITDA grew by 44 percent from last year. EBITDA margin also expanded by 300 basis points to 13 percent from 10 percent.

Welspun India said this was the highest EBITDA margin for the company in the last six quarters.

The company has also declared a dividend of 10 paise per share, record date for which has been set as June 30, 2023.

At the end of financial year 2023, Welspun India had cash worth Rs 593 crore on is books and it aims to become net debt free by financial year 2025.

Shares of Welspun India are currently trading 12.7 percent higher at Rs 98.60. The stock hit a 52-week high of Rs 99.5 in early trading. This is the best single-day performance for the stock in nearly a year.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Welspun aims to reduce net debt to below Rs 2400 crore in FY22

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Welspun India is looking at a net debt target below Rs 2,400 crore by the end of FY22, Sanjay Gupta, Chief Financial Officer, told CNBC-TV18.

“By the end of FY22, we are looking at a net debt target below Rs 2,400 crore and we are not changing that from our last guidance. We will continue to reduce our net debt and would reach net debt to zero position in next 3-4 years,” he said.

Also Read: Concentrating on technical textiles, plan to expand man-made fibre production: Welspun Flooring

On expansion, Gupta said, “In order to meet the growing demand, we are increasing our towel capacity by 16,600 metric tonne per annum at Anjar and with this increase, our capacity would move from 85,400 metric tonne per annum to 102,000 metric tonne per annum. This would be operational from Q4 of FY23 and it will give us an additional revenue of in excess of Rs 750 crore from the second year onward.”

For the entire interview, watch the video

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Textile stocks surge as government approves PLI scheme for sector

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Several textile stocks surged on Wednesday as that the Union Cabinet approved the Production Linked Incentive Scheme for textiles. Earlier in the day, sources had told CNBC-TV18 that incentives worth Rs 10,683 crore will be provided to the textile industry.

The government expects that the scheme will result in a fresh investment of above Rs 19,000 crore and additional production turnover of over Rs 3 lakh crore in 5 years, the sources had said.

At 14:26 IST, shares of textile players like Arvind, Raymond, Bombay Dyeing & Mfg Co, Bombay Rayon Fashions, Grasim Industries, Welspun India, Trident, KPR Mill, Nitin Spinners, Gokaldas Exports and Himatsingka Seide gained nearly 1-6 percent.

Also Read | Regaining India’s position in global textiles trade through PLI scheme for MMF & Technical Textiles

The output linked scheme will help bolster domestic manufacturing and benefit textile players in India.

The scheme is expected to provide employment to 7.5 lakh people.

States like Gujarat, Uttar Pradesh, Maharashtra, Punjab, Telangana, Tamil Nadu are Orissa are likely to benefit from the production linked scheme, said Piyush Goyal, Minister of Commerce & Industry, Consumer Affairs & Food & Public Distribution and Textiles.

The Indian textiles and apparel industry is reportedly one of the largest in the world and is also a key contributor to India’s export, by constituting about 12 percent of export earnings.

Also Read | Piyush Goyal likely to review textile PLI scheme; sector players spell challenges

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Rebate policy extension will boost cotton sector: Welspun India

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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In a big boost for the textile sector, the cabinet has extended the Rebate of State and Central Tax Levies (RoSCTL) scheme till March 2024. The rebate will be at the same rate as notified by the Textile Ministry in March.

To understand the impact, CNBC-TV18 spoke to Dipali Goenka, CEO & Joint Managing Director at Welspun India.

Goenka said, “There were couple of uncertainties, and we have been waiting for a long time and this announcement has been a transformational decision. This has actually given us a long road ahead to invest in this business.”

She added, “Our commodities are at an up surge, cotton, chemicals, coal and the others, they are on the upsurge. This actually helps us to be competitive with Bangladesh and Vietnam in the long run. I think that is where we see and we poise ourselves against. Far more investments will come into this category and more employment and more foreign currency as well.”

Goenka further said, “As textile manufacturers, we will invest where it is needed. Welspun is very strong on its path of becoming the FMCG for textiles, where we are talking about digitisation, a brand portfolio and also about creating a portfolio of supply chain collaboration.”

On exports, she said, “India is the largest producer of cotton and the largest exporter of cotton yarn and cotton as well. Bangladesh imports cotton from us and fundamentally that advantage India has. I will talk from home textile category, we are completely integrated in supply chains and that is the advantage India has.”

On PLI scheme, she said, “PLI is very much focused on man-made fibres and that is what it is, and that actually is one thing the government has done is, supporting man-made fibres because that again is something, which has been lying low. But with the Rebate of State and Central Levies and Taxes (RoSCTL), there will be a massive boost on the cotton segment and PLI will give the boost to the man-made fibres.”

For full management commentary, watch the video.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Here are key stocks that moved the most on May 14

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Indian indices ended flat on Friday as losses in metal, auto stocks offset a surge in FMCG majors. Asian Paints surged 8.5 percent and UPL ralled over 7 percent after both the stock reported stellar earnings for the March quarter.

The Sensex ended 42 points higher at 48,732 while the Nifty fell 19 points to settle at 14,678. Both indices finished the holiday-shortened week about 1 percent lower after losses earlier in the week on US inflation worries.

Broader markets underperformed benchmarks with the midcap and smallcap indices down around 1.5 percent each for the day.

Here are the key stocks that moved today:

PowerGrid InvIT: The initial public offering (IPO) of PowerGrid Infrastructure Investment Trust (PowerGrid InvIT) made a muted debut on the bourses today. The stock rose 3 percent to Rs 103 per share on BSE as against its issue price of Rs 100 per unit. The IPO was open for subscription from April 29-May 3 with a price band fixed at Rs 99-100 per unit. Sponsored by Power Grid Corporation of India, this was the first InvIT to be launched by the government company.

Asian Paints: The share price of Asian Paints surged over 8 percent after the company reported better-than-expected earnings for the March quarter. The company reported an 81.13 percent jump in its consolidated net profit to Rs 869.89 crore in Q4 helped by volume growth in the domestic as well as in the international market. The company had posted a net profit of Rs 480.25 crore during the January-March quarter of the previous fiscal, Asian Paints said in a regulatory filing.

UPL: The share price of UPL rallied over 7 percent after the company reported better-than-estimated earnings for the fourth quarter of fiscal 2021. The agrochemical company reported a consolidated profit at Rs 1,361 crore in Q4FY21, registering a 74 percent growth against Rs 784 crore in the year-ago quarter. The company’s consolidated revenue from operations during the quarter rose 14.8 percent to Rs 12,796 crore from Rs 11,141 crore, YoY, with volume growth at 18 percent and a price increase of 1 percent

HG Infra Engineering: Shares of HG Infra Engineering soared 15 percent after the company reported a robust set of numbers for the quarter ended March 2021 (Q4FY21), with standalone profit after tax jumping 91 percent year-on-year (YoY) to Rs 97.70 crore on the back of strong revenue. The construction and engineering company had logged a profit of Rs 51.3 crore in Q4FY20.

Welspun India: Welspun India shares rose 10 percent after the firm said that it has again signed an agreement with US-based retailer Target Corp. It added that until FY16, business with Target Corp accounted for 10 percent of the overall business.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow