A stock priced under Rs.100 has seen a significant 16 percent surge after the company announced a 1:6 rights issue for eligible shareholders and set the record date. This move has sparked strong investor interest, with shareholders now looking forward to the opportunity to subscribe to additional shares at a favorable ratio.
Price Action
During Monday’s trading session, the share price of Iris Clothings Ltd reached an intra-day high of Rs.59.70 per share, rising 16 percent from its previous close of Rs.51.47 per share. However, the shares later retreated to Rs.57.00 apiece. Over the past five years, the stock has delivered over 130 percent returns.
Rights Issue
Iris Clothing has experienced a notable 16 percent surge after announcing a 1:6 rights issue for eligible shareholders and setting the record date. The company plans to issue 1,35,95,105 fully paid-up equity shares of face value Rs.2 each at a price of Rs.35 per share, which includes a premium of Rs.33 per share.
This rights issue, amounting to Rs.4,758.28 lakhs, will be offered to eligible shareholders on a rights basis, with one equity share being offered for every six fully paid-up shares held as of the record date, March 13, 2025. The issue price is 17.5 times the face value of the equity shares.
Network and Domestic Presence
Iris Clothing operates across 26 states with 10 units, including 8 manufacturing facilities and 2 dispatch centers. The company boasts an installed capacity of 33,000 pieces per day and works with 177 distributors, ensuring widespread reach and efficient production across its network. This extensive infrastructure supports the company’s strong market presence and growth potential.
Product Portfolio
Iris Clothing Limited is a rapidly growing Indian company specializing in the design, manufacture, branding, and sale of readymade garments, with a primary focus on kids’ wear under the brand name DOREME. The company offers a wide range of stylish and comfortable clothing for infants, toddlers, and junior boys and girls, ensuring a balance of quality and affordability for their customers.
Financial Performance
Iris Clothing Limited reported remarkable financial growth for Q3 FY25, with revenue soaring to Rs.33.38 crore, reflecting an increase of 42 percent compared to Rs.23.48 crore in Q3 FY24. Furthermore, the company’s Profit After Tax (PAT) surged by 20 percent, rising to Rs.2.37 crore from Rs.1.99 crore in the similar time period.
Ratio Analysis
The company has a Return on Capital Employed (ROCE) of 16.24 percent and a Return on Equity (ROE) of 15.56 percent. Its Price-to-Earnings (P/E) ratio stands at 34.54, lower than the industry average of 46.31. Furthermore, the company maintains a current ratio of 4.78, a debt-to-equity ratio of 0.62, and an Earnings Per Share (EPS) of Rs.1.49.
Written by – Siddesh S Raskar
