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Kitex Garments: Growth expected from second half - Views on News from Equitymaster
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Kitex Garments: Growth expected from second half
Nov 2, 2015

Kitex Garments announced the results for second quarter of financial year 2015-2016 (2QFY16). The topline remained almost flat for both the second quarter and first half although profits grew by 40.5% YoY and 27.8% YoY respectively in 2QFY16 and 1HFY16. Here is our analysis of the results.

Performance summary

  • Sales growth remained flat in 1HFY16.
  • Operating margins improved from 21.7% to 22.6% over the past year primarily due to rise lower input costs.
  • Higher other income helped net profits go up by 27.8% YoY in 1HFY16.
  • Declared interim dividend of Rs 0.75 per share.

Financial snapshot

(Rs m) 2QFY15 2QFY16 Change 1HFY15 1HFY16 Change
Total income 120,951 120,200 -0.6% 217,133 217,028 0.0%
Expenditure 94,550 89,123 -5.7% 170,107 168,054 -1.2%
Operating profit (EBDITA) 26,401 31,077 17.7% 47,026 48,974 4.1%
Operating profit margin (%) 21.8% 25.9%   21.7% 22.6%  
Other income 12,513 20,866 66.8% 21,526 39,017 81.3%
Interest 4,109 4,396 7.0% 7,666 9,169 19.6%
Depreciation 5,176 5,494 6.1% 10,220 10,952 7.2%
Profit before tax 29,629 42,053 41.9% 50,666 67,870 34.0%
Tax 10,308 14,898 44.5% 16,908 24,740 46.3%
Profit after tax/(loss) 19,321 27,155 40.5% 33,758 43,130 27.8%
Net profit margin (%) 16.0% 22.6%   15.5% 19.9%  
No. of shares (m)#         47.5  
Diluted earnings per share (Rs)         22.7  
P/E ratio (x) *         31.7  

*Based on trailing 12 month earnings

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