High Textile Penny Shares: Small textile firms are current within the early stage of the worth chain producing yarns & cloth, engaged in contract manufacturing, or extra. Their valuations path behind bigger firms due to enterprise dimension and derived demand.
Nonetheless, these textile penny shares may be profitable investments for risk-taking buyers who suppose bigger firms are overvalued. On this article, we current an inventory of high textile penny shares for such risk-loving buyers.
However earlier than we rush to the record, for starters, tell us what a penny inventory is.
What’s a Penny Inventory?
Penny shares are the shares of small-cap firms, often having a market capitalization of lower than Rs. 500 crores. The businesses have low share costs of lower than Rs. 85 or so. The inventory can commerce for as rock-bottom as Rs 1 and even 50 paise a bit.
A penny inventory has comparatively lesser liquidity. Along with this, it might include restrictions of supply solely, no margin buying and selling, and extra.
Danger-loving buyers are at all times looking for penny shares within the hope of incomes multi-bagger beneficial properties. Nonetheless, penny shares usually implode as usually as they go up. Retail buyers ought to train excessive warning whereas placing their cash in penny shares.
High Textile Penny Shares in India
So with out additional ado, allow us to rapidly bounce to know concerning the high textile penny shares in india on BSE and NSE.
High Textile Penny Shares #1 – Swasti Vinayaka Synthetics
Based in 1981, Swasti Vinayaka Synthetics is concerned within the manufacturing of suiting, shirting and different attire merchandise. It’s a small-cap textile penny inventory with a market capitalization of Rs 66.9 crore.
The corporate has two manufacturing vegetation at Palghar and Tarapur in Maharashtra. It has a well-established design studio with the newest CAD know-how. Its key focus and experience lie in producing high-end cotton, cotton-blended and linen designer shirting.
Swasti Vinayaka Synthetics provides its merchandise to giant retail chains, the readymade clothes sector, garment exporters and enormous company homes.
Its record of shoppers consists of some well-established names reminiscent of Bombay Dyeing, Arvind Way of life Manufacturers, Pantaloons, Trent, ITC, LIC of India, Coca Cola and extra.
Its internet revenue has remained constant over the past three years regardless of registering a decline in earnings in FY21. For the monetary 12 months ending 2022, the textile producer posted a internet revenue of Rs 1.75 crore on revenues of Rs 20.35 crore. As a feather in its cap, it’s a debt-free inventory with an insignificant debt-to-equity ratio of 0.04 solely.
High Textile Penny Shares #2 – R&B Jeans
R&B Jeans was promoted by the RawatKhedia Group and the Borana Group in 2012. With over a enterprise historical past of 30 years, each teams are well-known enterprise households in Surat, Gujarat.
The corporate is without doubt one of the largest vertically built-in denim producers globally with an annual capability of 30 million meters. Its superior services can produce high-width denim of as much as 76 inches.
Moreover, its ending facility is well-equipped to churn out a broad vary of denim finishes: moist chemical software, foam software, over-dyeing, coating, resin software and extra.
Barring 2021, its revenues have constantly grown over time. For the monetary 12 months ended 2022, the denim producer clocked a internet revenue of Rs 22 crore on gross sales of Rs 293 crore.
It’s a worthwhile enterprise with excessive return ratios. RoCE and RoE stood at 25.80% and 37.40% respectively. As a vote of confidence, promoters have a excessive shareholding within the enterprise at 73.8%.
High Textile Penny Shares #3 – Sarla Efficiency Fibers
Previously generally known as Sarla Polyester Ltd., Sarla Efficiency Fibers is concerned within the manufacturing and export of polyester & nylon textured, twisted & dyed yarns, coated yarns, excessive tenacity yarns and stitching thread.
The corporate manufactures over 250 sorts of value-added yarns and threads. Along with its manufacturing vegetation outdoors Mumbai in Silvassa, Dadra and Vapi, Sarla has a worldwide presence with its operations in Portugal, and Europe.
On a yearly foundation, its gross sales rose by 65.12% to Rs 426 crore in FY22 from Rs 258 crore a 12 months earlier. Alongside the identical traces, the underside line grew by 74.07% to Rs 47 crore from Rs 27 crore.
The inventory presently trades at a sexy P/E ratio of 9.31 and a price-to-book worth ratio of 0.89. Moreover, it’s a low-debt inventory with a debt-to-equity ratio of 0.32.
High Textile Penny Shares #4 – APM Industries
APM Industries established its textile spinning facility in 1979-80 below the commerce identify of Orient Sintex. Quick ahead to immediately, the corporate has a broad product line which is at par with worldwide high quality requirements.
It’s concerned within the manufacturing of high-quality blended spun yarn, Polyester yarns, Acrylic yarns, 100% fancy yarns and fibre-dyed yarns. It’s textile spinning unit has 55,584 spindles capability to fabricate 18 million kg of yarn yearly.
APM Industries is a turnaround textile penny inventory that delivered stellar gross sales and revenue figures in FY22. The corporate generated a internet revenue of Rs 15 crore on an earnings of Rs 317 crore in FY22. This was accompanied by an enlargement in working revenue margins.
Its earnings had been on a decline since 2017. For example, the corporate’s revenue and gross sales have been solely Rs 5 crore and Rs 237 crore in FY21.
The promoter holding within the textile penny inventory stood at 64.4% as of September 30, 2022. It presently trades at a sexy P/E ratio of 5.6 and value to ebook worth of 0.79.
High Textile Penny Shares #5 – VTM
VTM Ltd. traces its origins again to 1946 when the Indian textile business was in a nascent stage. Quick ahead to immediately, it’s a well-established participant fulfilling necessities for each the home markets and exports.
It has state-of-the artwork manufacturing facility with 258 looms, 80 Sulzer machines, 163 air jets, 9 Jacquards and 6 Rapier Dobby looms. It manufactures various kinds of materials together with square-inch drills, twills, sateens, piques, jacquards, and a spread of advanced dobbies.
VTM earned a internet revenue of Rs 15 crore on gross sales of Rs 194 crore in FY22. Its earnings and internet revenue rose 35.66% and 50% on a YoY foundation respectively.
The textile penny inventory has a excessive promoter holding of 75%. It presently trades at a price-to-earnings ratio of 15.1 and a powerful price-to-book worth ratio of 0.85.
The Madurai-based firm is nearly debt-free with a zero debt-to-equity ratio of 0.02.
Checklist of High Textile Penny Shares in India
We learn bout 5 high textile penny shares intimately above. The record beneath highlights extra such penny shares.
Firm NameCMP (Rs)Market Cap (Rs Cr)
SPL Industries75.8220
M Okay Exim (India)87.8236
Mafatlal Industries62.8443
APM Industries60.0130
Vardhman Acrylics59.0475
VTM50.4203
Sarla Efficiency Fibers44.0370
R&B Denims42.4297
Pasupati Acrylon34.6309
Libas Shopper Products20.353.7
Swasti Vinayaka Synthetics7.4366.9
A brief part beneath highlights the analysis methodology used for this text.
Analysis Methodology
We used the inventory screener of the Commerce Brains Portal for writing this text. The analysis has been restricted to textiles, textile-manmade fibers, textile-spinning, and textile-weaving; the three sub-sectors of the textile business.
As for the market capitalization and present share value, we saved the higher restrict of Rs 500 crore and Rs 85 respectively. Along with this, the debt-to-equity ratio was saved beneath 1 to keep away from any overly-leveraged shares.
Lastly, the price-to-earnings ratio vary was saved between 1 and 50. This helped to filter out reasonably worthwhile firms.
All these parameters left some 48 shares. We exercised subjective judgement for gross sales and internet revenue progress for these shares.
The picture beneath exhibits a bit of the Commerce Brains Inventory Screener.
In Conclusion
We at the moment are on the finish of our research of high textile penny shares in India. We noticed how the businesses differ of their merchandise throughout totally different levels of the worth chain. As an investor eying penny shares, one ought to decide firms that one understands intuitively. As the quantity of obtainable info is much less, a great understanding of the inventory’s enterprise reduces the draw back.
In your opinion, what parameters ought to buyers take into account whereas analyzing penny shares? How about you tell us within the feedback beneath?
Now you can get the most recent updates within the inventory market on Commerce Brains Information and you can too use our Commerce Brains Inventory Screener to search out the perfect shares.
Vikalp Mishra is a commerce graduate from the College of Delhi. He likes to put in writing on finance, cash and enterprise. He’s a voracious reader with a real curiosity in investing. Drop him a mail at [email protected].
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