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Textile Study

The document analyzes investment opportunities in the textile sector as the stock market rises. It provides details on several textile companies, including their share price, PE ratio, earnings growth, and institutional holdings. Century Enka and Trent are highlighted as particularly attractive investments due to their low PE ratios and strong earnings growth. The document recommends investing in fundamentally strong textile companies while avoiding those with weak earnings like Kitex, Ganesh Ecosphere, and Nandan Denim.

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88 views4 pages

Textile Study

The document analyzes investment opportunities in the textile sector as the stock market rises. It provides details on several textile companies, including their share price, PE ratio, earnings growth, and institutional holdings. Century Enka and Trent are highlighted as particularly attractive investments due to their low PE ratios and strong earnings growth. The document recommends investing in fundamentally strong textile companies while avoiding those with weak earnings like Kitex, Ganesh Ecosphere, and Nandan Denim.

Uploaded by

Dynamic Levels
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Time to Invest in Textile in the Bull Market

With the rising market where by Nifty advances towards the recent high of high of 8995
on 8th September'16 soon to touch the 9000 mark, its time to invest in textile sector.

Symbol

LTP

June
EPS

PE
Ratio

Inst

DE
Equity

EPS
Growth

Pledge

Return
from
Budget

MF

CENTENKA

282.9

10.3

111

15.20%

36

107

TRENT

215.9

125

36.90%

37

78

270.85

4.6

97

16

6.20%

21

75

232.4

12

17

26

-16.30%

67

KITEX

478.85

4.4

44

20

-53.50%

36

VTL

1010.1

29.3

204

10

14.70%

58

35

NDL

127.55

3.4

10

10

27

-3.90%

34

56.25

1.6

36

11

47.70%

30

New
listing

HIMATSEIDE
GANECOS

TRIDENT
SPAL*

351.5

9.6

11

0.00%

This sector started performing post Budget as:


100% FDI is allowed under the automatic route in the textile sector; investment is
subject to all applicable regulations and laws.
Government introduced the scheme for integrated Textile Parks, which will
provide world class infrastructure to the sector. Till date 57 textile parks have
been started with the investment of Rs. 6000 crs. 25 more textile park to open by
2017.
Training to be provided to more than 15 lakhs people under integrated Skill
Development scheme.

Century Enka is the lowest PE share trading at a PE of 8 in spite the share price has
gone up 95% from recent low of 145 in March to 282. What makes it a leader in this
sector is that it is a Zero debt company and the earning has been improving every

quarter from last 4 quarters. The forward PE of the company is 6.84. Century Enka
Limited is a Pune based company. The products manufactured by Century Enka Limited
are Polyester Filament Yarn, Nylon Filament Yarn, Polyester POY, Polyester and Nylon
Chips of industrial and fabric grade and Nylon Industrial Yarn and Nylon Tyre Cord
Fabrics. The company operates in one segment i.e. Synthetic yarn. Centur Enka has 111
institutions invested in this share out of which 36 as Mutual Funds.

Trent is the next best performing share in this sector


trading at low PE of 8 and has moved 78% form recent
low of 140 in March. Trent Limited is a part of Tata Group
retail operations company that owns and manages a
number of retail chains in India, such as Westside (lifestyle
retail stores), Star Bazaar (a hypermarket chain),
Landmark ( a books and music chain), and Fashion Yatra (
a complete family fashion store ). This share has given
correction from recent high of 250 and is trading at 215.
Tata Sons will increase its stake in Trent Ltd by acquiring 1.17% to 27.74% as part of
restructuring of its investment portfolio. It will buy 3.87 lakh share of Trent from one
Af-Taab
Investment
company.
The Himatsingka is an India based vertically integrated Home Textile Company. It
focuses on the manufacturing, retailing and distribution of Home Textile products. They
operate in home textile business segment. The companys product portfolio includes bed
Linen, drapery & upholstery and Silk & Blended yarn. Recently from low of 144 this
share made a life time high of 297.
Ganesh Ecoshpere is an India based company. The company is into the business of
manufacturing Recycled Polyester staple Fibre (Green Fibre) through recycling of postconsumer pet bottle waste. The company is engaged in only one business segment i.e.
Synthetic Yarn & Fibre. The products of the company find application in geotextiles,
carpets, mattresses, wallpaper, teabags, acoustic materials and many more. The
company has a steady topline and bottom line with Revenue and earning maintained at
par in all the quarters.
Kitex is a high PE company in the sector trading at a PE of 20. Kitex is engaged in the
business of manufacturing and exporting of Garments. The company manufactures
different type of garments like jacket, shirt, pants, inner wear and etc. The company

operates in two business segment garment and fabrics. It is a low beta share. The
earning dropped from 9.45 per share to 4.39 per share in June quarter.
Vardhaman Textile has the highest number of institutions and Mutual Funds invested in
this share. This company comes under the umbrella of the Vardhman group. The
company operates in six business segments- yarns, sewing thread, steel, fabric, acrylic
fiber, garment and other business. This share has not shown much price movement since
Budget and is available at correction from recent high of 1120. Earning of the company
has consistently increased in last 4 quarters from Rs 20 per share to Rs 29.26 per share
making the forward PE of the share as 8.3 and a good bet in this sector.
NDL, Nandan Denim Ltd is an India based company engaged in the manufacturing of
gray cotton fabrics, khakhis and denims. The products of the company include denims,
bottom weight fabrics, twills, stretch, bull denim, broken twills. This share has promoter
holding pledge of 27%. There has not been any growth in the earning in NDL in last 4
quarters. One can book profit in this share.
Trident is engaged in the business of manufacturing agro based paper, yarn, Terry towels
and sulphuric acid. The company also has a captive power plant. The company operates
in two business segment textile and paper. This share showed good price movement as
there was news of Target group shifting its contract from Welspun India to Trident.
Trident is a low PE share with growth in Earning and is trading at a good buy level of
55.
History shows that market always rewards fundamentally good shares so Be Invested in
the Best shares and avoid share like Kitex, Gancos and NDL.

Disclaimer

The investment advice or guidance provided by way of recommendations, reports or other ways are solely the personal views of
the research team. Users are advised to use the data for the purpose of information and rely on their own judgment while making
investment decision.
Dynamic Equities Pvt. Ltd - SEBI Investment Advisory Reg. No.: INA300002022

Disclosure

Dynamic Equities Pvt. Ltd. is a member of NSE, BSE, MCX SX and a DP with NSDL & CDSL. It is also engaged in Investment
Advisory Services and Portfolio Management Services. Dynamic Commodities Pvt. Ltd., associate company, is a member of MCX &
NCDEX. We declare that our activities were neither suspended nor we have defaulted with any stock exchange authority with
whom we are registered. SEBI, Exchanges and Depositories have conducted the routine inspection and based on their
observations have issued advise letters or levied minor penalty on for certain operational deviations.
Answers to the Best of our knowledge and belief of Dynamic/ its Associates/ Research Analyst: DYNAMIC/its Associates/
Research Analyst/ his Relative:

Do not have any financial interest / any actual/beneficial ownership in the subject company.
Do not have any other material conflict of interest at the time of publication of the research report
Have not received any compensation from the subject company in the past twelve months
Have not managed or co-managed public offering of securities for the subject company.
Have not received any compensation for brokerage services or any products / services or any compensation or other
benefits from the subject company, nor engaged in market making activity for the subject company
Have not served as an officer, director or employee of the subject company

Article Written by
Surbhi Lohia

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