Jasch Industries - Jasch Industries

📊 BSE: 500220 🏢 Other Textile Products 📅 Last Updated: 11/13/2025 15:25

💰 Financial Performance

Revenue Growth by Segment

The PU Coated Fabrics & Allied Products segment revenue grew by 16.1% YoY, increasing from INR 70.63 Cr in FY24 to INR 82.01 Cr in FY25. Historically, the JIL group revenue grew 14.1% from INR 156.64 Cr in FY18 to INR 178 Cr in FY19.

Geographic Revenue Split

The company is primarily domestic-focused; however, earnings in foreign exchange (FOB basis) were INR 0.166 Cr in FY25, a significant 74.8% decrease from INR 0.661 Cr in FY24.

Profitability Margins

Segment profits for PU Coated Fabrics fell by 18.4% from INR 5.77 Cr in FY24 to INR 4.71 Cr in FY25. Operating margins for the group were 9.0% in FY19 but dropped to 6.6% in the first nine months of FY20 due to higher input costs.

EBITDA Margin

Operating margin was 9.0% in FY19, up from 8.4% in FY18. However, recent performance shows margin erosion due to the mandate to use Piped Natural Gas (PNG), which is 300% costlier than conventional fuels.

Capital Expenditure

Expenditure on Capital Goods and Components in foreign currency increased by 386% from INR 1.15 Cr in FY24 to INR 5.57 Cr in FY25, indicating significant investment in machinery.

Credit Rating & Borrowing

CRISIL reaffirmed ratings at 'CRISIL BBB/Stable' and 'CRISIL A3+' in April 2020 before withdrawing them at the company's request. Bank limit utilization was high at 93% as of March 2019.

⚙️ Operational Drivers

Raw Materials

Petroleum-based raw materials including PU Resin and PVC, which are critical for synthetic leather production.

Import Sources

Raw materials are imported on a C.I.F. basis, with foreign currency expenditure totaling INR 42.92 Cr in FY25, representing a slight 0.3% decrease from INR 43.07 Cr in FY24.

Capacity Expansion

Current production for PU Coated Fabrics was 22.56 lakh meters in FY25, up 6.87% from 21.11 lakh meters in FY24. Specific planned capacity in MT/MW is not disclosed.

Raw Material Costs

Raw material and consumable imports cost INR 42.92 Cr in FY25. Erratic petroleum prices are cited as a primary factor eroding profitability margins.

Manufacturing Efficiency

Production volume increased by 6.87% YoY to 22.56 lakh meters, though segment assets increased by 24.2% to INR 51.38 Cr, suggesting a push for higher scale despite margin pressure.

📈 Strategic Growth

Expected Growth Rate

16.1%

Growth Strategy

Growth is targeted through expansion into the automotive sector for PU coated fabrics and entry into new product lines within existing segments. The company also leverages its US-based subsidiary, Indev Gauging System Inc, to support its industrial gauge division.

Products & Services

PU/PVC Coated Fabric (Synthetic Leather) and Industrial Gauges (thickness, coating, paint, and moisture measurement systems).

Brand Portfolio

Jasch, Indev Gauging Systems.

New Products/Services

New opportunities are being explored in the automotive sector for synthetic leather, which typically offers higher value-add than the footwear segment.

Market Expansion

The company operates a wholly-owned subsidiary, Jasch North America Company (JNAC), to capture the North American industrial gauge market.

Strategic Alliances

Acquisition of Indev Gauging System Inc (USA) in 2012 to bolster the electronic gauge business.

🌍 External Factors

Industry Trends

The synthetic leather industry is seeing a shift toward automotive applications; however, environmental regulations in India (like the PNG mandate) are forcing a transition to costlier clean energy.

Competitive Landscape

The company faces intense competition in both the synthetic leather and industrial gauge segments, which limits its ability to maintain high margins.

Competitive Moat

Moat is based on a diversified product profile (leather and gauges) and an established market position since 1985, though it is challenged by intense competition and high regulatory compliance costs.

Macro Economic Sensitivity

Highly sensitive to petroleum price cycles and regulatory changes regarding environmental fuel mandates in the National Capital Region (NCR).

Consumer Behavior

Demand is driven by the footwear industry's performance and a growing preference for synthetic alternatives to natural leather in automotive interiors.

Geopolitical Risks

Ongoing tariff wars and border hostilities are cited as factors that could impact operations and raw material availability.

⚖️ Regulatory & Governance

Industry Regulations

Compliance with SEBI (LODR) Regulations 2015 and Section 135 of the Companies Act for CSR. Factories must adhere to strict environmental norms in the National Capital Region.

Environmental Compliance

Mandatory transition to Piped Natural Gas (PNG) as fuel in NCR-based factories has increased fuel costs by 300%.

Legal Contingencies

Pending litigations exist as disclosed in Note 37 of the Financial Statements; however, the specific aggregate INR value of these contingencies is not provided in the summary.

⚠️ Risk Analysis

Key Uncertainties

Volatility in petroleum-based raw material prices and potential for further environmental regulatory tightening in the NCR region.

Geographic Concentration Risk

Manufacturing is concentrated in Sonipat, Haryana (NCR), making it highly vulnerable to regional environmental mandates.

Third Party Dependencies

High dependency on petroleum refineries and chemical suppliers for PU and PVC resins.

Technology Obsolescence Risk

The industrial gauge division faces technology risks, mitigated by the acquisition of US-based Indev Gauging Systems to stay current with online measurement standards.