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Check Before You Invest : Vippy Spinpro Ltd

BSE: 514302 NSE: ISIN: INE660D01017
  |   Sector:  Textiles & Apparels   |   Industry:  Textile - Spinning

Snapshot

Q.1 Which industry/sub-sector does Vippy Spinpro Ltd belong to?
Vippy Spinpro Ltd belongs to the Textiles & Apparels sector, operating specifically within the Textile - Spinning segment.
Q.2 Is Vippy Spinpro Ltd a good quality company?
Vippy Spinpro 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 Vippy Spinpro Ltd undervalued or overvalued?
Vippy Spinpro 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 8.47 8.31
Price to Book 0.98 1.23
Price to Sales 0.38 0.44
EV to EBITDA 4.74 5.14
Q.4 Is Vippy Spinpro Ltd a good buy now?
Vippy Spinpro 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 Vippy Spinpro Ltd?
Vippy Spinpro Ltd revenue growth is 12% for FY-2025, which is below its 5-year CAGR of 20.35%, indicating slower growth.

Q.2 Gross Profit margin of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Gross profit margin which is the profit after deduction of direct costs, is 9.5% for FY-2025, which is in line with its 5-year median of 9.5%, indicating stable margins.

Q.3 Operating Profit Margin of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 9.29% for FY-2025, which is in line with its 5-year median of 9.29% indicating stable margins.

Q.4 Net Profit Margin of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Net Profit Margin is 4.11% for FY-2025, is below its 5-year median of 4.53%, indicating decreasing margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 9.5 9.5
Operating Profit Margin (%) 9.29 9.29
Net Profit Margin (%) 4.11 4.53

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Return on Asset is 8.25%, which is in line with its 5-year historical median of 8.25%, indicating stable asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Return on capital employed is 13.78% for FY-2025, which is in line with its 5-year historical median of 13.78%. 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 Vippy Spinpro Ltd?
Vippy Spinpro Ltd Return on equity is 14.05% for FY-2025, which is in line with its 5-year historical median of 14.05%, indicating the business is making similar use of its shareholders capital.

Q.8 Cash conversion cycle of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Cash conversion cycle is 92 days, below its 5-year historical median of 121 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) 2.01 1.9
ROE (%) 14.05 14.05
ROCE (%) 13.78 13.78
Cash Conversion Cycle 92 days 121 days

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

Q.9 Debt to Equity ratio of Vippy Spinpro Ltd?
Vippy Spinpro Ltd Debt-to-Equity ratio is 0.38, 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 Vippy Spinpro Ltd?
Vippy Spinpro Ltd Debt to cash flow from operations is 1.13, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Vippy Spinpro Ltd?

Q.1 Promoter shareholding and pledge status of Vippy Spinpro Ltd?
Promoters hold 66.58% of the Vippy Spinpro Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Vippy Spinpro Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Vippy Spinpro Ltd vs industry peers?
Vippy Spinpro Ltd revenue CAGR is 20.35%, compared to the industry median CAGR of 1.47%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) 12 1.5
Gross Profit Growth (%) 68.7 1.8
Operating Profit Growth (%) 46.4 -1.5
Net Profit Growth (%) 163.5 2.1
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 2.01 0.94
ROE (%) 14.05 -
ROCE (%) 13.78 5.99
Cash Conversion Cycle (days) 91.78 61

Valuation & price assessment

Q.1 Stock return of Vippy Spinpro Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 22% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
22% 22.3% -3.6% -8.9%
Q.2 Valuation ratios of Vippy Spinpro Ltd vs historical?
The current P/E ratio of 8.47 is in line with than its historical median of 8.31, indicating that the stock is trading near 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 8.47 8.31 9.43
Price to Book 0.98 1.23 0.72
Price to Sales 0.38 0.44 0.40
EV to EBITDA 4.74 5.14 7.20

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