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Check Before You Invest : Kamadgiri Fashion Ltd

BSE: 514322 NSE: ISIN: INE535C01013
  |   Sector:  Textiles & Apparels   |   Industry:  Textile - Manmade Fibres

Snapshot

Q.1 Which industry/sub-sector does Kamadgiri Fashion Ltd belong to?
Kamadgiri Fashion Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile - Manmade Fibres segment.
Q.2 Is Kamadgiri Fashion Ltd a good quality company?
Kamadgiri Fashion 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 Kamadgiri Fashion Ltd undervalued or overvalued?
Kamadgiri Fashion 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 25.13 30.66
Price to Book 1.97 1.34
Price to Sales 0.49 0.19
EV to EBITDA 11.08 7.14
Q.4 Is Kamadgiri Fashion Ltd a good buy now?
Kamadgiri Fashion 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 Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd revenue growth is -18.4% for FY-2025, which is below its 5-year CAGR of -9.54%, indicating slower growth.

Q.2 Gross Profit margin of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Gross profit margin which is the profit after deduction of direct costs, is 2.7% for FY-2025, which is in line with its 5-year median of 2.6%, indicating stable margins.

Q.3 Operating Profit Margin of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 4.52% for FY-2025, which is in line with its 5-year median of 4.52% indicating stable margins.

Q.4 Net Profit Margin of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Net Profit Margin is 0.68% for FY-2025, is above its 5-year median of 0.25%, indicating increasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 2.7 2.6
Operating Profit Margin (%) 4.52 4.52
Net Profit Margin (%) 0.68 0.25

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Return on Asset is 1.22%, which is above its 5-year historical median of 0.37%, indicating improved asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Return on capital employed is 8.31% for FY-2025, which is in line with its 5-year historical median of 8.31%. The current ROCE is below its estimated weighted average cost of capital (WACC) of 14%, indicating value preservation.

Q.7 Return on Equity (ROE) of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Return on equity is 3.42% for FY-2025, which is above its 5-year historical median of 1.94%, indicating the business is making better use of its shareholders capital.

Q.8 Cash conversion cycle of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Cash conversion cycle is 95 days, in line with its 5-year historical median of 97 days, indicating stable working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 1.8 1.65
ROE (%) 3.42 1.94
ROCE (%) 8.31 8.31
Cash Conversion Cycle 95 days 97 days

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

Q.9 Debt to Equity ratio of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Debt-to-Equity ratio is 0.61, which is above the industry average of 0.36, indicating higher debt levels in the industry.

Q.10 Debt to cash flow from operations of Kamadgiri Fashion Ltd?
Kamadgiri Fashion Ltd Debt to cash flow from operations is 0.97, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Kamadgiri Fashion Ltd?

Q.1 Promoter shareholding and pledge status of Kamadgiri Fashion Ltd?
Promoters hold 37.53% of the Kamadgiri Fashion Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Kamadgiri Fashion Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Kamadgiri Fashion Ltd vs industry peers?
Kamadgiri Fashion Ltd revenue CAGR is -9.54%, compared to the industry median CAGR of 0%, indicating slower growth and losing its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -18.4 -
Gross Profit Growth (%) 72.6 6.8
Operating Profit Growth (%) 49.4 -3
Net Profit Growth (%) 0 5.3
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 1.8 1.06
ROE (%) 3.42 3.31
ROCE (%) 8.31 6.78
Cash Conversion Cycle (days) 95.15 51

Valuation & price assessment

Q.1 Stock return of Kamadgiri Fashion Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 7.4% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
7.4% 35.5% 18.4% 1.6%
Q.2 Valuation ratios of Kamadgiri Fashion Ltd vs historical?
The current P/E ratio of 25.13 is lower than its historical median of 30.66, indicating that the stock is trading below 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 25.13 30.66 17.61
Price to Book 1.97 1.34 1.13
Price to Sales 0.49 0.19 0.55
EV to EBITDA 11.08 7.14 7.33

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