Synopsis:
A B Cotspin secures ₹18 crore cotton yarn order, boosting growth plans with a sustainability focus, targeting ₹350-400 crore turnover and a stronger presence in domestic and export markets.
This small-cap Textile stock, engaged in manufacturing cotton yarn, knitted fabric, cottonseed oil, and oilcakes, operating primarily in the textile and oil production sectors, jumped 10.41 percent after securing an order worth Rs. 18 crore for 712 MT of cotton yarn.
With a market capitalization of Rs. 1,032.07 crores, the share of AB Cotspin India Limited has reached an intraday high of Rs. 504 per equity share, rising nearly 10.41 percent from its previous day’s close price of Rs. 456.50. Since then, the stock has retreated and is currently trading at Rs. 467 per equity share.
What is the news?
A B Cotspin India Limited has received a major order worth about Rs. 18 crore for supplying 712 MT of cotton yarn. The order will be completed within two months. This new order highlights the company’s strong presence in the textile market and its reputation as a reliable supplier of quality cotton yarn.
The company focuses on sustainable practices such as expanding solar power capacity and aims for a turnover of Rs 350-400 crore and an EBITDA of Rs. 40-45 crore for FY 2025-26. These measures enhance competitiveness, especially ahead of the festival season, and are expected to drive significant growth in export hubs like Tirupur and Ludhiana.
Investment Plans
AB Cotspin India Limited is set to invest up to Rs. 1,500 crore to significantly increase its manufacturing capacity. The expansion will involve adding 200,000 spindles to its existing 50,832 spindles, effectively doubling its production capabilities. This will allow the company to produce more cotton-based products to meet rising market demand.
The new facilities will be established across India, with key locations in Madhya Pradesh and Maharashtra. The project is expected to be fully operational within three years, enhancing AB Cotspin’s production strength and market presence.
Company Overview
AB Cotspin India Limited is a textile company established in 1997, primarily engaged in the manufacturing of cotton yarn, knitted fabric, cottonseed oil, and oilcakes.
The company started with cotton ginning and gradually diversified into yarn and fabric production, expanding its spindle capacity over time. The company is strategically located in Punjab, a major cotton-producing region, which facilitates efficient raw material procurement and market access.
Recent quarter results
Coming into financial highlights, AB Cotspin India Limited’s revenue has decreased from Rs. 72.51 crore in Q1 FY25 to Rs. 66.69 crore in Q1 FY26, which is a drop of 8.03 percent. The net profit has grown by 84.14 percent from Rs. 2.27 crore in Q1 FY25 to Rs. 4.18 crore in Q1 FY26. AB Cotspin India Limited’s revenue and net profit have grown at a CAGR of 32.79 percent and 123.61 percent, respectively, over the last two years.
In terms of return ratios, the company’s ROCE and ROE stand at 10.3 percent and 11.4 percent, respectively. AB Cotspin India Limited has an earnings per share (EPS) of Rs. 6.22, and its debt-to-equity ratio is 1.50x.
Written By – Nikhil Naik
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