Textile · Founded 1981 · www.hpthreads.com · BSE 502873 · · ISIN INE950C01014
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1. Business Overview
HP Cotton Textile Mills Ltd. is an Indian textile company primarily engaged in the manufacturing of cotton textile products. Its core business involves the processing of raw cotton into various forms, typically starting from spinning yarn, which can then be further processed into woven fabrics. The company's business model is largely B2B (business-to-business), supplying yarn and/or fabric to garment manufacturers, home textile producers, or other industrial users, both domestically and internationally. The company generates revenue by adding value through manufacturing processes to raw cotton, earning margins on the conversion of raw materials into higher-value textile products.
2. Key Segments / Revenue Mix
Without specific company reports, precise revenue mix breakdown is not available. However, for a "Cotton Textile Mill," typical key segments include:
Spinning: Production of cotton yarn (carded, combed, ring-spun, open-end yarn). This is often the primary segment.
Weaving: Production of grey fabric from yarn.
Processing/Finishing: If integrated, this would involve dyeing, printing, and finishing of fabrics.
Given the name "Cotton Textile Mills," yarn and grey fabric production are likely the dominant revenue generators.
3. Industry & Positioning
The Indian textile industry is one of the largest globally, characterized by its fragmentation, intense competition, and significant contribution to exports. It includes a vast spectrum of players from large, vertically integrated corporations to small, unorganized units. HP Cotton Textile Mills Ltd. likely operates as a mid-sized player within the cotton textile segment. Its positioning would depend on its specific product focus (e.g., particular yarn counts, fabric types), quality standards, cost efficiency, and established customer relationships. It faces competition from larger players with greater scale and integration, as well as numerous other mid-sized and smaller mills.
4. Competitive Advantage (Moat)
The textile industry, particularly in commodity segments like basic yarn and fabric, is generally considered to have lower moats due to product fungibility and capital intensity. For HP Cotton Textile Mills Ltd., potential competitive advantages are likely to be built on:
Operational Efficiency & Cost Control: Modern machinery, lean manufacturing processes, and efficient energy/resource management can lead to a cost advantage.
Established Customer Relationships: Long-standing supply agreements and a reputation for reliable quality can create sticky customer bases.
Proximity to Raw Materials: Location near cotton-growing regions can offer a logistical advantage and potentially better raw material sourcing.
Product Specialization: Developing expertise in specific types of yarns or fabrics that command a premium or have niche demand.
A strong brand moat is less likely given its likely B2B nature, and significant switching costs are typically low in this sector.
5. Growth Drivers
Domestic Demand Growth: Rising population, increasing disposable incomes, and evolving fashion trends in India drive demand for textiles and apparel.
Export Market Opportunities: India's competitive advantages in cotton production and manufacturing skill can drive export growth, especially with favorable trade policies and global demand for textiles.
Government Initiatives: "Make in India," Production Linked Incentive (PLI) schemes for textiles, and other export promotion policies can support expansion and modernization.
Capacity Expansion and Modernization: Investment in new, efficient machinery can increase output, improve quality, and reduce costs.
Value Addition and Diversification: Moving into higher-value products (e.g., specialty yarns, technical textiles) or enhancing processing capabilities.
6. Risks
Raw Material Price Volatility: Fluctuations in cotton prices (due to weather, global demand, crop yield) directly impact profitability.
Energy and Input Costs: Volatility in power, fuel, dyes, and chemical prices can erode margins.
Intense Competition: Both domestic and international competition puts pressure on pricing and market share.
Global Economic Downturns: Reduced consumer spending globally can dampen demand for textile exports.
Exchange Rate Fluctuations: As an exporter/importer of inputs, currency volatility can impact revenue and costs.
Regulatory and Trade Policy Changes: Changes in tariffs, trade agreements, labor laws, or environmental regulations can affect operations and market access.
Technological Obsolescence: The need for continuous capital investment to upgrade machinery to remain competitive.
7. Management & Ownership
HP Cotton Textile Mills Ltd., typical of many Indian mid-cap companies, is likely promoter-led, with the founding family or a core group holding a significant stake and exercising control over strategic direction and daily operations. The quality of management would depend on their experience, vision, ability to navigate industry cycles, and track record of capital allocation and operational efficiency. Public shareholding would constitute the remainder of the ownership structure.
8. Outlook
The outlook for HP Cotton Textile Mills Ltd. is intrinsically linked to the broader performance of the Indian and global textile industry. The company can benefit from India's growing domestic market and its strong position as a global cotton producer and exporter, supported by government initiatives to boost the sector. Opportunities exist for growth through capacity expansion, modernization, and strategic product diversification into higher-value segments. However, the company operates in a highly cyclical and competitive industry. Profitability will remain susceptible to volatile raw material prices, energy costs, and fluctuating demand driven by economic cycles and fashion trends. Maintaining operational efficiency, prudent financial management, and adaptability to market changes will be crucial for sustained performance in this environment.
Price goes above X
Price falls below X
PE goes above X
PE falls below X
| #(Fig in Cr.) | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|
| Net Sales | 26 | 19 | 25 | 34 | 33 | 36 | 36 | 34 | 34 | 28 |
| Other Income | 0 | 1 | 0 | 0 | 0 | 1 | 0 | 1 | 1 | 1 |
| Total Income | 26 | 20 | 26 | 34 | 33 | 37 | 36 | 35 | 34 | 29 |
| Total Expenditure | 24 | 20 | 23 | 30 | 30 | 33 | 32 | 32 | 31 | 25 |
| Operating Profit | 2 | -0 | 3 | 4 | 3 | 4 | 4 | 4 | 3 | 3 |
| Interest | 2 | 2 | 1 | 2 | 2 | 2 | 2 | 2 | 2 | 2 |
| Depreciation | 1 | 1 | 1 | 1 | 1 | 1 | 1 | 1 | 1 | 1 |
| Exceptional Income / Expenses | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Profit Before Tax | -1 | -3 | 0 | 2 | 0 | 1 | 2 | 1 | 1 | 1 |
| Provision for Tax | 0 | -0 | -0 | 1 | 0 | 0 | 1 | 0 | 0 | 0 |
| Profit After Tax | -1 | -2 | 0 | 1 | 0 | 1 | 1 | 1 | 1 | 1 |
| Adjustments | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Profit After Adjustments | -1 | -2 | 0 | 1 | 0 | 1 | 1 | 1 | 1 | 1 |
| Adjusted Earnings Per Share | -3.2 | -5.8 | 1.2 | 2.1 | 0.7 | 2.5 | 2.2 | 2 | 1.7 | 1.7 |
| #(Fig in Cr.) | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | TTM |
|---|---|---|---|---|---|
| Net Sales | 132 | 84 | 94 | 128 | 132 |
| Other Income | 2 | 2 | 2 | 1 | 3 |
| Total Income | 134 | 86 | 95 | 129 | 134 |
| Total Expenditure | 119 | 96 | 89 | 116 | 120 |
| Operating Profit | 16 | -9 | 6 | 14 | 14 |
| Interest | 3 | 5 | 7 | 7 | 8 |
| Depreciation | 3 | 4 | 3 | 3 | 4 |
| Exceptional Income / Expenses | 0 | 0 | 0 | 0 | 0 |
| Profit Before Tax | 10 | -19 | -4 | 4 | 5 |
| Provision for Tax | 3 | -1 | -5 | 1 | 1 |
| Profit After Tax | 7 | -18 | 1 | 3 | 4 |
| Adjustments | 0 | -0 | -0 | -0 | 0 |
| Profit After Adjustments | 7 | -18 | 1 | 2 | 4 |
| Adjusted Earnings Per Share | 18.4 | -46.1 | 1.9 | 6.4 | 7.6 |
| # | 1 Year | 3 Year | 5 Year | 10 Year |
|---|---|---|---|---|
| Sales CAGR | 36% | -1% | 0% | 0% |
| Operating Profit CAGR | 133% | -4% | 0% | 0% |
| PAT CAGR | 200% | -25% | 0% | 0% |
| # | 1 Year | 3 Year | 5 Year | 10 Year |
|---|---|---|---|---|
| Share Price CAGR | -5% | 1% | 16% | 7% |
| ROE Average | 17% | -20% | -9% | -9% |
| ROCE Average | 21% | 1% | 6% | 6% |
| #(Fig in Cr.) | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 |
|---|---|---|---|---|
| Shareholder's Funds | 31 | 13 | 14 | 16 |
| Minority's Interest | 0 | 0 | 0 | 0 |
| Borrowings | 9 | 9 | 6 | 9 |
| Other Non-Current Liabilities | 6 | 8 | 3 | 4 |
| Total Current Liabilities | 60 | 63 | 61 | 61 |
| Total Liabilities | 105 | 92 | 84 | 90 |
| Fixed Assets | 38 | 41 | 38 | 36 |
| Other Non-Current Assets | 5 | 2 | 2 | 2 |
| Total Current Assets | 63 | 49 | 44 | 52 |
| Total Assets | 105 | 92 | 84 | 90 |
| #(Fig in Cr.) | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 |
|---|---|---|---|---|
| Opening Cash & Cash Equivalents | 0 | 1 | 1 | 0 |
| Cash Flow from Operating Activities | 8 | 0 | 12 | 7 |
| Cash Flow from Investing Activities | -17 | -0 | -0 | -2 |
| Cash Flow from Financing Activities | 9 | 0 | -13 | -6 |
| Net Cash Inflow / Outflow | 0 | 0 | -1 | 0 |
| Closing Cash & Cash Equivalent | 1 | 1 | 0 | 0 |
| # | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 |
|---|---|---|---|---|
| Earnings Per Share (Rs) | 18.41 | -46.15 | 1.94 | 6.36 |
| CEPS(Rs) | 25.88 | -35.97 | 11.23 | 14.98 |
| DPS(Rs) | 1 | 0 | 0 | 0 |
| Book NAV/Share(Rs) | 78.8 | 33.11 | 35.05 | 41.42 |
| Core EBITDA Margin(%) | 10.08 | -13.72 | 4.45 | 9.72 |
| EBIT Margin(%) | 9.59 | -15.96 | 2.63 | 8.2 |
| Pre Tax Margin(%) | 7.27 | -22.3 | -4.48 | 2.96 |
| PAT Margin (%) | 5.32 | -21.44 | 0.97 | 2 |
| Cash Profit Margin (%) | 7.56 | -16.74 | 4.7 | 4.58 |
| ROA(%) | 6.68 | -18.29 | 1.03 | 2.95 |
| ROE(%) | 23.11 | -83.19 | 6.78 | 17.14 |
| ROCE(%) | 19.47 | -22.69 | 4.85 | 20.9 |
| Receivable days | 46.56 | 54.98 | 28.8 | 24.51 |
| Inventory Days | 89.23 | 139.43 | 118.84 | 84.46 |
| Payable days | 205.86 | 252.32 | 294.77 | -16.78 |
| PER(x) | 7.15 | 0 | 66.84 | 13.59 |
| Price/Book(x) | 1.67 | 2.49 | 3.7 | 2.09 |
| Dividend Yield(%) | 0.76 | 0 | 0 | 0 |
| EV/Net Sales(x) | 0.63 | 0.85 | 0.9 | 0.53 |
| EV/Core EBITDA(x) | 5.32 | -7.5 | 14.14 | 4.96 |
| Net Sales Growth(%) | 0 | -36.47 | 11.41 | 36.96 |
| EBIT Growth(%) | 0 | -205.96 | 118.36 | 325.92 |
| PAT Growth(%) | 0 | -356.72 | 105.01 | 183.68 |
| EPS Growth(%) | 0 | -350.74 | 104.21 | 227.7 |
| Debt/Equity(x) | 1.13 | 3.11 | 2.53 | 2.21 |
| Current Ratio(x) | 1.05 | 0.79 | 0.73 | 0.86 |
| Quick Ratio(x) | 0.51 | 0.28 | 0.25 | 0.36 |
| Interest Cover(x) | 4.13 | -2.51 | 0.37 | 1.57 |
| Total Debt/Mcap(x) | 0.68 | 1.25 | 0.68 | 1.06 |
| # | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|
| Promoter | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 |
| FII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| DII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0.02 | 0.02 |
| Public | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.09 | 35.09 |
| Others | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 |
| # | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|
| Promoter | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 |
| FII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| DII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Public | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 |
| Others | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 |
| # | 1 Year | 3 Year | 5 Year | 10 Year |
|---|---|---|---|---|
| Sales CAGR | +36% | -1% | — | — |
| Operating Profit CAGR | +133% | -4% | — | — |
| PAT CAGR | +200% | -25% | — | — |
| Share Price CAGR | -5% | +1% | +16% | +7% |
| ROE Average | +17% | -20% | -9% | -9% |
| ROCE Average | +21% | +1% | +6% | +6% |
| # | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|
| Promoter | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 | 64.9 |
| FII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| DII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0.02 | 0.02 |
| Public | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 | 35.1 |
| Others | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 | 100 |
| # | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|---|
| Promoter | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 | 0.25 |
| FII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| DII | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Public | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 | 0.14 |
| Others | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Total | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 | 0.39 |
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