Check Before You Invest : HP Cotton Textile Mills Ltd

Q: Which industry/sub-sector does HP Cotton Textile Mills Ltd belong to?

HP Cotton Textile Mills Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile segment.

Q: Is HP Cotton Textile Mills Ltd a good quality company?

HP Cotton Textile Mills Ltd is a quality company, based on a multi-year financial track record. This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q: Is HP Cotton Textile Mills Ltd undervalued or overvalued?

HP Cotton Textile Mills Ltd appears Overvalued, as its key valuation ratios are higher than their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 13.73, Historic Median: 6.31. Price to Book, Current: 2.08, Historic Median: 2.35. Price to Sales, Current: 0.31, Historic Median: 0.39. EV to EBITDA, Current: 5.2, Historic Median: 5.01

Q: Is HP Cotton Textile Mills Ltd a good buy now?

HP Cotton Textile Mills Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Q: Revenue growth of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd revenue growth is 37% for FY-2025, which is above its 5-year CAGR of 9.4%, indicating faster growth.

Q: Gross Profit margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Gross profit margin which is the profit after deduction of direct costs, is 5.5% for FY-2025, which is in line with its 5-year median of 5.5%, indicating stable margins.

Q: Operating Profit Margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.74% for FY-2025, which is in line with its 5-year median of 9.7% indicating stable margins.

Q: Net Profit Margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Net Profit Margin is 2.01% for FY-2025, is in line with its 5-year median of 2.01%, indicating stable margins. Profitability Metrics. Gross Profit Margin (%), Current: 5.5, Historic Median: 5.5. Operating Profit Margin (%), Current: 9.74, Historic Median: 9.7. Net Profit Margin (%), Current: 2.01, Historic Median: 2.01

Q: Return on Asset of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Return on Asset is 2.96%, which is in line with its 5-year historical median of 2.96%, indicating stable asset utilization efficiency.

Q: Return on capital employed (ROCE) of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Return on capital employed is 20.9% for FY-2025, which is in line with its 5-year historical median of 20.9%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Check Before You Invest : HP Cotton Textile Mills Ltd

BSE: 502873 NSE: ISIN: INE950C01014

| Sector: Textiles & Apparels | Industry: Textile

Snapshot

Q.1 Which industry/sub-sector does HP Cotton Textile Mills Ltd belong to?

HP Cotton Textile Mills Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile segment.

Q.2 Is HP Cotton Textile Mills Ltd a good quality company?

HP Cotton Textile Mills Ltd is a quality company, based on a multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is HP Cotton Textile Mills Ltd undervalued or overvalued?

HP Cotton Textile Mills Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	13.73	6.31
Price to Book	2.08	2.35
Price to Sales	0.31	0.39
EV to EBITDA	5.2	5.01

Q.4 Is HP Cotton Textile Mills Ltd a good buy now?

HP Cotton Textile Mills Ltd is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.
How efficiently has it utilized Capital?
By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.
How is it managing its Debt?
By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd revenue growth is 37% for FY-2025, which is above its 5-year CAGR of 9.4%, indicating faster growth.

Q.2 Gross Profit margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Gross profit margin which is the profit after deduction of direct costs, is 5.5% for FY-2025, which is in line with its 5-year median of 5.5%, indicating stable margins.

Q.3 Operating Profit Margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.74% for FY-2025, which is in line with its 5-year median of 9.7% indicating stable margins.

Q.4 Net Profit Margin of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Net Profit Margin is 2.01% for FY-2025, is in line with its 5-year median of 2.01%, indicating stable margins.

	Current Level	5-year Historic Median
Gross Profit Margin (%)	5.5	5.5
Operating Profit Margin (%)	9.74	9.7
Net Profit Margin (%)	2.01	2.01

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Return on Asset is 2.96%, which is in line with its 5-year historical median of 2.96%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Return on capital employed is 20.9% for FY-2025, which is in line with its 5-year historical median of 20.9%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 14%, indicating value creation.

Q.7 Return on Equity (ROE) of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Return on equity is 17.15% for FY-2025, which is in line with its 5-year historical median of 17.15%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Cash conversion cycle is 32 days, below its 5-year historical median of 51 days, indicating improved working capital management. However, you need to compare this with its peers in the industry.

	Current Level	5-year Historic Median
Asset Turnover (x)	1.47	1.35
ROE (%)	17.15	17.15
ROCE (%)	20.9	20.9
Cash Conversion Cycle	32 days	51 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Debt-to-Equity ratio is 2.21, which is above the industry average of 0.42, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of HP Cotton Textile Mills Ltd?

HP Cotton Textile Mills Ltd Debt to cash flow from operations is 4.85, which is at a unhealthy level.

Ownership & governance

D: Promoter shareholding and pledge status of HP Cotton Textile Mills Ltd?

Q.1 Promoter shareholding and pledge status of HP Cotton Textile Mills Ltd?

Promoters hold 64.90% of the HP Cotton Textile Mills Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does HP Cotton Textile Mills Ltd performance compare with that of its Peers?

Q.1 Revenue growth of HP Cotton Textile Mills Ltd vs industry peers?

HP Cotton Textile Mills Ltd revenue CAGR is 9.40%, compared to the industry median CAGR of 0%, indicating faster growth and gaining its market share.

Profit Metrics

	Current Level	5-year Industry Median
Revenue Growth (%)	37	-
Gross Profit Growth (%)	0	9.1
Operating Profit Growth (%)	197.6	8.5
Net Profit Growth (%)	180.4	13

Operating Efficiency

	Current Level	5-year Industry Median
Asset Turnover (x)	1.47	0.95
ROE (%)	17.15	4.34
ROCE (%)	20.9	7.56
Cash Conversion Cycle (days)	32.08	101

Valuation & price assessment

Q.1 Stock return of HP Cotton Textile Mills Ltd over the last decade?

Over the last 9 year(s), the stock has delivered a CAGR of 7.3% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	7.3%	15.8%	1.3%	-4.9%

Q.2 Valuation ratios of HP Cotton Textile Mills Ltd vs historical?

The current P/E ratio of 13.73 is higher than its historical median of 6.31, indicating that the stock is trading above its historical average valuation.

Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	13.73	6.31	20.16
Price to Book	2.08	2.35	1.32
Price to Sales	0.31	0.39	1.06
EV to EBITDA	5.2	5.01	9.31

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Check Before You Invest : HP Cotton Textile Mills Ltd

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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Check trending companies

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