Nitin Spinners Q4 Results Review - Improvement In Yarn Demand To Aid Revenue Growth: ICICI Direct

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .ICICI Direct Report.Nitin Spinners Ltd. reported an improvement in operational performance on a sequential basis but macro headwinds continued to impact its performance on a YoY basis.Revenue grew 22% QoQ to Rs 654.8 crore (down 15% YoY). Gross margins declined 330 basis points QoQ to 29.8% (versus 41% in Q4 FY22) probably owing to high cost cotton inventory and tough demand scenario.However, positive operating leverage led to lower employee (down 102 bps QoQ) and other expenses (down 194 bps QoQ), which curtailed the decline in Ebitda margins to only 40 bps QoQ to 10.8%. Absolute Ebitda grew 18% QoQ to Rs 71 crore (down 58% YoY)).Consequently, profit after tax grew 22% QoQ to Rs 38.5 crore (declined 55% YoY).Key triggers for future price performance: Capacity expansion across segments to drive revenue growth. Nitin Spinners’ planned capex of Rs 900 plus crore can generate incremental revenue of ~Rs 1100 crore (peak revenue of Rs 3500 crore).We expect Nitin Spinners to generate superior return on capital employed of ~15% in FY25E (versus average RoCE: 10-12%). We model revenue, earnings compound annual growth rate of 15%, 21%, respectively, in FY23-25E..Click on the attachment to read the full report:.Shoppers Stop - Steady Progress Continues On Strategic Growth Pillars: Systematix.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Nitin Spinners Q4 Results Review - Improvement In Yarn Demand To Aid Revenue Growth: ICICI Direct

We expect Nitin Spinners to generate superior return on capital employed of ~15% in FY25E.

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