The shares of fast-growing stationery product manufacturers gained up to 2 percent after the company announced the strategic acquisition of a 51.77 percent stake in Unilan Healthcare.
With a market capitalization of Rs 16,481.44 crore, the shares of DOMS Industries Ltd were trading at Rs 2,715.80 per share, increasing around 1 percent as compared to the previous closing price of Rs 2,699.05 apiece.
Reason for Rise:-
According to the company filing, DOMS Industries Ltd. has announced the strategic acquisition of a 51.77 percent share in Unilan Healthcare. DOMS has acquired Uniclan, making it a subsidiary of the company. The company has bought 71,16,080 equity shares for ₹ 54.88 crore. The initial injection of ₹ 28.88 crore would be used for capacity growth, debt reduction, and working capital requirements.
Moreover, the acquisition enables DOMS to expand its product range and diversify its product portfolio in line with its overall growth strategy to cater to a broader market.
Additionally, Uniclan has a state-of-the-art manufacturing facility in Jaipur, Rajasthan with an installed capacity approximately 400 million pullup pant style baby diapers per annum which are primarily sold under its flagship brand “Wowper”.
Financial performance:-
The company’s revenue soared 17%, rising from Rs 379 crore in Q1FY24 to Rs 445 crore in Q1FY25, while net profit zoomed by50%, growing from Rs 36 crore to Rs 54 crore during the same period, reflecting strong financial performance and continued business growth.
Capex and Capacity Expansion:
The company plans to spend Rs 125 Cr in capex, excluding WIP, with total Capex for FY ’25 expected between Rs 210-225 million. They will add 100,000 sq. ft. of manufacturing space, and expand their wooden pencil division by Q4 FY ’25.
With an existing capacity of 2 million pens per day, test runs are ongoing at a new facility to add 1 million more. Once fully operational, the company will reach 3 million pens per day, utilizing 1.8-1.9 million sq. ft. across 44 acres.
Future Growth and Plans:
The company plans continuous capacity investments to drive growth, with the writing instruments category as a key driver. A new product, DOMS Tots, is in development. Phase one of greenfield expansion will contribute by Q1 FY ’26-’27, with management expecting stable EBITDA margins.
Footprint:-
The company prioritizes servicing existing customers over adding new retail outlets, currently catering to over 120,000 retail locations. While focused on the general trade segment, it is also performing well in modern retail, balancing growth and customer service effectively in its distribution strategy.
Company snapshot:-
DOMS India manufactures and markets wooden polymer pencils, sharpeners, erasers, mathematics and drawing instruments, ballpoint pens, and a variety of student art supplies.
Written by:- Abhishek Singh
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
