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Damodar Industries Ltd. Stock Analysis

Small Cap
Evaluated by 239 users | BSE: 521220 | NSE: DAMODARIND |
Textile - Spinning
Damodar Threads Ltd.(DTL) a Damodar Group company was incorporated on December 11,1987 as a private limited company and started commercial production in September 1988. The company was converted into public limited company on March 20, 1992. It was established with the main object to set...

Analysis of Financial Track Record

Data adjusted to bonus, split, extra-ordinary income, rights issue and change in financial year end
Financial track record gives insight into the company's performance on key parameters over the past ten years. MoneyWorks4me’s proprietary colour codes make it easy for retail investors to gauge the company’s past performance.
Value Creation
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Capital Employed 12.18%11.35%15.03%15.51%12.52%10.21%9.45%7.47%4.67%3.58%
Growth Parameters
Growth Parameters Colour Code Guide
Net Sales (Rs. Cr.) 385392582735593621704650771768
Y-o-Y Gr. Rt.-2%48.4%26.2%-19.3%4.7%13.4%-7.7%18.7%-0.5%
Adjusted EPS (Rs.) 3.72.645.186.655.354.634.354.612.64-3.29
Y-o-Y Gr. Rt.--28.7%96.2%28.4%-19.6%-13.5%-6.1%6%-42.7%-224.6%
Book Value per Share (Rs.) 20.7222.6427.1832.736.7539.7944.2247.4249.4942.11
Adjusted Net Profit 8.25.911.514.811.910.39.710.35.9-7.7
Net Op. Cash Flow (Rs. Cr.) 12.219.520.727.753.728.512.818.410.225.6
Debt to Cash Flow from Ops 9.335.686.3552.093.418.269.2832.4213.85
Standalone financials take only the parent company into account while consolidated financials take into account financials of the parent company as well as of all its subsidiaries. In most companies consolidated financials should be used for analysis.
Damodar Industries Ltd. should be analysed on a Standalone basis
CAGR
CAGR Colour Code Guide
  9 yrs 5 yrs 3 yrs 1 yr
Net Sales 8%5.3%2.9%-0.5%
Adjusted EPS -198.7%-190.7%-191.1%-224.6%
Book Value per Share 8.22.8-1.6-14.9
Share Price 5.4% -2.7% -28.3% -20.1%
Key Financial Parameter
Performance Ratio Colour Code Guide
 Mar'11Mar'12Mar'13Mar'14Mar'15Mar'16Mar'17Mar'18Mar'19Mar'20
Return on Equity (%) 20.712.1720.822.215.412.0910.3510.065.45-7.35
Operating Profit Margin (%) 8.218.798.327.798.356.555.335.334.715.6
Net Profit Margin (%) 2.141.51.982.012.011.661.371.580.76-1
Debt to Equity 2.462.22.171.91.371.11.071.623.013.61
Working Capital Days 748668648376729192106
Cash Conversion Cycle 59715653686564746471
Entity Percentage Holding
Promoters 70.63%
Institutions 0.01%
Non-Institutions 29.36%
Pledged *0.000.000.000.000.000.000.000.000.000.00
* Pledged shares as % of Promoter's holding (%)
Data is not available for this company.

The 5-year analysis of Damodar Industries Ltd.'s performance infers:

Damodar Industries Ltd. earnings have declined by -190.7%, whereas share price has depreciated -2.7% CAGR over the past five years, indicating the company's share price is likely overvalued. However, for specific investment actions please connect with your investment advisor.

We analysed the performance of Damodar Industries Ltd. share prices over the last 10 years. Here is what we found out:

Damodar Industries Ltd. share price has depreciated 0.1% annually over the past ten years.

Damodar Threads Ltd.(DTL) a Damodar Group company was incorporated on December 11,1987 as a private limited company and started commercial production in September 1988. The company was converted into public limited company on March 20, 1992. It was established with the main object to set up a unit at Daman for twisting and doubling of synthetic yarn.

The profound Damodar Group boasts of having a completely integrated and advanced production line for manufacturing fancy and speciality

Damodar Threads Ltd.(DTL) a Damodar Group company was incorporated on December 11,1987 as a private limited company and started commercial production in September 1988. The company was converted into public limited company on March 20, 1992. It was established with the main object to set up a unit at Daman for twisting and doubling of synthetic yarn.

The profound Damodar Group boasts of having a completely integrated and advanced production line for manufacturing fancy and speciality yarns.

DTL is the largest fancy yarn manufacturing brand. Since beginning Damodar’s philosophy was to provide a quality product at an affordable price. Passion for yarn has made the company a trendsetter in the industry.

Damodar was one of the first to offer blended-fiber and novelty yarns at popular prices.The company constantly looks all over the world to find ideas for new yarns,colours and designs. Each Damodar yarn has its own personality and is designed in variety of combinations that is appropriate to its texture and its use. Damodar Threads is continuously striving to improve efficiency in operations by improving the quality of human resources and increasing the strength of human resources. The company is continuously improving its IT infrastructure which is the need of the day to reduce operating costs of the company. The company at the same time is opening offices in various textile markets of the country to improve business.

The company has been synonymous with creativity in Indian textile Industry for more than two decades.The company is engaged in spinning, draw-texturising, air-texturising, fancy doubling and yarn dyeing. The company has in-house manufacturing operations, which are essential building bricks of fashion. Its ring spinning plant produces high quality yarns enriching the aesthetic value through slubs, neps, injected slubs, multicolour effects and grindle effects. The unit is designed with utmost flexibility and equipped with mechanical and electronic attachments at all stages of spinning for imparting special effects in the yarns. Value addition does not end at spinning stage, it is further enhanced in the post spinning processes as well.

The company is equipped with not only TFOs, but also fancy doubling, hollow doubling, covering machines, boucle machines and attachments to manufacture fantasy yarns.

The company currently employs job work to manufacture fancy yarns which is done by outsourcing the yarns.This entails a risk of the company supplying the know-how and the design to the manufacturer. With the increasing demand which leads to an increase in production as well as greater risk by the infringement of intellectual property as the company does not have any intellectual property rights; the job work mode of manufacturing is getting more costly.

Along with fancy yarns, the company started manufacturing cotton yarns. The company has undertaken wide expansion programme by installing spinning mill of 36480 spindles, 58 TFO units at Silvassa. The total capital cost of the project is Rs.9000 Lakh out of which the bank finance is Rs.6000Lakh. Bank of Baroda, Mumbai Main Office (MMO) and State Bank of India, Industrial Finance branch, Mumbai has sanctioned the term loan of Rs.3000 Lakhs each and total working capital facilities of Rs.1000 lakh (Increase from existing limit of Rs.450 lakh). The company has completed the remaining part of its expansion programme by unsecured loans of Rs.1733 Lakh and internal accruals of Rs.1267 Lakh. New plant in Silvassa has a capacity of producing 15 tonnes daily with 32,908 spindles.

The company has also installed 58 TFO’s two for one twist, for doubled/twisted yarns. The company due to expansion of its spinning unit, it has shifted its plant (Damodar Plants Limited) from Daman to Dadra. Further since full plant operation was not possible in existing spaces, the company had no option, except to shift their plant to Dadra. Cotton yarn has enabled the company to penetrate special markets in India as well as export. The company has also started merchant export of cotton yarn. The company is already exporting its products in various countries across the globe like Turkey, Egypt, Indonesia, Thailand, Vietnam, Argentine and Brazil.

Product range of the company includes:

  • Cotton Yarn
  • Fancy Yarn
  • Blended Fancy Yarn
  • Product Enquiry
  • Spun yarn in polyester/viscose,100% polyester,100% viscose,100% cotton and silk/polyester in various counts

Milestones:

  • 1987- Incorporated as a Pvt.Ltd.Co. with objective to manufacture fancy yarn.
  • 1988 -Commercial production started at its factory at Daman
  • 1992- Converted into public limited company
  • 1993-Commencement of implementation/production of multicolored yarn project at Vapi (Gujarat)
  • 1994 -Commencement of fancy yarn project at Daman
  • 1995-Successful completion of IPO (oversubscribed by 7 times)
  • 2006-07 -Commencement of implementation of expansion project by installing spinning mills of 36480  spindles, 58 TFO units on 30000 sq.metres NA land already purchased at Silvassa at a  projected cost of Rs.9000 Lakh.
Puchho Befikar
SEBI Registered: Investment Adviser - INA000013323
Research Analyst - INH000000719

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