Vardhaman Textiles Q4 sees profit rise despite revenue dip
Vardhaman Textiles reported strong profit growth for Q4 2024, defying a slight decline in revenue. Profit jumped 26.36 per cent year-over-year (YoY) to Rs 200.59 crore, while revenue dipped 1.05 per cent YoY to Rs 2459.41 crore.
This positive performance was driven by a significant increase in operating income, which surged 45.99 per cent quarter-over-quarter (QoQ) and 33.74 per cent YoY to Rs 211.4 crore. This rise can be attributed to a decrease in selling, general & administrative expenses by 8.89 per cent QoQ, despite a 7.1 per cent YoY increase.
Earnings per share (EPS) also reflected the profit growth, rising 26.43 per cent YoY to Rs 7.05.
Analysts seem to favor Vardhaman Textiles, with a consensus recommendation of Buy based on ratings from four analysts polled on May 11, 2024. One analyst recommends selling, one recommends buying, and two recommend a strong buy. The company's current market cap sits at Rs 12343.43 crore, with a 52-week high of Rs 475.5 and a low of Rs 318.35.
Meanwhile, Vardhman is making a big push for growth with a Rs 2,000 crore investment plan. This initiative focuses on both expanding capacity and adopting sustainable practices. Vardhman will add 50,000 equivalent spinning spindles to its current capacity of 12.37 lakh, significantly boosting yarn production. Additionally, they'll establish a new facility dedicated to producing 15 lakh meters of technical textiles monthly.
Sustainability is a key focus, with Vardhman exploring solar, wind, or hybrid projects for green power generation. This aligns with their goal of reducing their environmental impact.
Modernization is another pillar of the plan. Vardhman will upgrade its IT systems to improve operational efficiency and streamline business processes. The entire project is expected to be completed within two years. By expanding capacity and adopting modern technologies, Vardhman aims to achieve better synergy, gain a competitive edge, and effectively meet growing market demands.
