The Indian garment sector is a cornerstone of the country’s economy, contributing significantly to employment and exports. Renowned for its diverse range of textiles, from traditional handlooms to modern apparel, the industry caters to both domestic and international markets. India’s strong raw material base, skilled workforce, and growing focus on sustainability have made it a key player in global fashion.
Government initiatives like the Production-Linked Incentive (PLI) Scheme and free trade agreements further support its expansion. With increasing demand for high-quality, affordable clothing, the Indian garment sector continues to evolve, combining tradition with innovation to meet global market trends.
Share Price
Kitex Garments Limited has delivered an impressive 1-year return of 206.61%, with its share price rising from ₹208 to ₹637. Over the past six months, the stock surged by 192%, increasing from ₹218 to ₹637.
Despite this stellar performance, the stock witnessed a dip today, trading at ₹637.8, down 4.35% from the previous close of ₹667.05. This movement reflects short-term volatility in an otherwise strong upward trend, showcasing Kitex’s robust market performance over the past year.
Bonus Issue
The company has announced a bonus equity share issue in a 2:1 ratio, granting two fully paid equity shares of ₹1 each for every existing equity share of ₹1 held as of the record date. This issuance is subject to shareholder approval through a postal ballot.
The record date for determining eligible shareholders will be announced shortly.
Financial Results
Kitex Garments showcased robust financial growth in September 2024, with revenue rising by 61%, from ₹134 crore in September 2023 to ₹216 crore. Net profit almost tripled during the same period, surging from ₹13 crore to ₹37 crore.
Operating profit margin (OPM) also improved significantly, increasing from 14% to 25%, reflecting enhanced operational efficiency and profitability. This stellar performance highlights the company’s strong business fundamentals and its ability to deliver consistent growth across key financial metrics.
About the Company
Kitex Garments Limited was incorporated in 1992 and was promoted by Mr. Sabu M Jacob. The company exports cotton and organic cotton garments especially infant wear to US and European markets. Kitex Garments Ltd. (KGL) is the world’s second-largest manufacturer of cotton and organic cotton ready-to-wear garments for infants and children between 0-24 months.
Kitex USA LLC is an associate company of Kitex Garments Ltd. It was incorporated as a joint investment between the company and Kitex Childrenswear Limited to facilitate design for US Market customers. The company sells infant wear under the brands “Lamaze” and “Little Star” in the US and Canada.
Clients
Kitex Garments Limited (KGL) is a trusted manufacturing partner for some of the world’s leading apparel and retail brands. The company’s major clients include Gerber and William Carter’s, renowned for their kidswear brands like Carter’s Babies, and Little Planet, and popular retailers such as TJ Maxx, Target, and Walmart.
A significant portion of KGL’s sales is driven by its top three customers, highlighting the company’s strong partnerships and consistent quality in delivering premium kidswear to global markets. These collaborations reinforce KGL’s position as a leading exporter in the garment industry.
Expansion of Production Capacity
Co. is setting up a second manufacturing facility in Warangal, Telangana, and a third one in Sitamampur, Telangana at Rs. 2,890 crores to be completed by March 2025 for additional capacities across the value chain.
Conclusion
Kitex Garments has demonstrated exceptional growth with a 206.61% return over the past year and impressive financial performance, including tripled net profits and improved operating margins. The company’s announcement of a 2:1 bonus share issue further rewards investors.
As the world’s second-largest manufacturer of infant cotton garments, with strong partnerships with global brands and ambitious expansion plans worth Rs. 2,890 crores in Telangana, Kitex appears well-positioned for continued growth. Its focus on premium kidswear and expanding production capacity suggests promising long-term potential.
Written By: Dipangshu Kundu
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