Active Clothing - Active Clothing
Financial Performance
Revenue Growth by Segment
The company reported a total income of INR 297.12 Cr in FY25, representing a 39.72% YoY growth from INR 212.66 Cr in FY24. While specific percentage growth for each segment (sweaters, jackets, t-shirts) was not explicitly broken down, management confirmed that every segment is growing, with the Levi's partnership alone scaling to INR 100 Cr.
Geographic Revenue Split
The company caters primarily to international markets and premium foreign brands. While a specific percentage split for Active Clothing is not disclosed, the broader outerwear jacket market is dominated by North America at 38.46%, and management noted that the American market is their main consumption market, making them sensitive to US trade tariffs.
Profitability Margins
Net Profit (PAT) grew by 73.73% YoY to INR 8.45 Cr in FY25 from INR 4.86 Cr in FY24. Diluted EPS increased by 74.12% to INR 5.45. Profitability is driven by the 'design-to-shelf' model which allows the company to capture higher value-added margins compared to traditional contract manufacturers.
EBITDA Margin
EBITDA for FY25 was INR 28.49 Cr, a 34.24% increase from INR 21.23 Cr in FY24. The EBITDA margin stood at approximately 9.59% for FY25. For H1 FY26, revenue reached INR 147.66 Cr compared to INR 128.15 Cr in H1 FY25, a 15.2% increase, maintaining consistent operational profitability.
Capital Expenditure
The company is executing a major expansion involving the rollout of 652 knitting machines. This investment is designed to scale total annual revenue to a peak of INR 700 Cr upon completion, more than doubling current capacity to meet growing demand for flat-knit products.
Credit Rating & Borrowing
The company maintains an 'Above average' financial risk profile. Credit sensitivity factors indicate an upward rating trigger if net cash accruals exceed INR 25 Cr. Conversely, a decline in cash accruals below INR 12 Cr or a large debt-funded capex could lead to a downgrade.
Operational Drivers
Raw Materials
Key raw materials include cotton, polyester, wool, and various yarns used for flat-knit and circular-knit products. While specific cost percentages per material are not disclosed, the company utilizes 'washed-down cotton' and 'polyester quilted' fabrics for its core jacket manufacturing line.
Import Sources
Not specifically disclosed in the documents, though the company emphasizes 'Make in India' initiatives and local manufacturing at its Fatehgarh Sahib facility in Punjab.
Capacity Expansion
Current operations utilize a state-of-the-art facility in Fatehgarh Sahib, Punjab, with over 2,300 skilled members. The company is in the process of completing the installation of 652 knitting machines to reach a revenue capacity of INR 700 Cr, up from the current INR 297 Cr level.
Raw Material Costs
Raw material costs are managed through tech-enabled design and virtual knitting, which reduces yarn waste and eliminates excessive sample shipping. This digital sampling approach optimizes procurement costs and aligns with sustainability goals.
Manufacturing Efficiency
Efficiency is driven by an integrated 'design-to-shelf' model where all processes are under one roof. This ensures stringent quality control and faster turnaround times, which is critical for high-fashion streetwear brands requiring rapid inventory refreshes.
Logistics & Distribution
The company operates a multi-brand retail and distribution network with 200+ MBOs and 7 dedicated retail stores in Punjab. It is the largest marketing partner for Levi's in Chandigarh, Punjab, J&K, and Himachal Pradesh.
Strategic Growth
Expected Growth Rate
33%
Growth Strategy
The company plans to reach its INR 700 Cr revenue target by completing the installation of 652 knitting machines, expanding its dealer network from 200 to 300 partners, and deepening its 'design-to-shelf' integration. It is also diversifying into new categories like shoe uppers for Adidas and Skechers and expanding its infant clothing business with Tchibo Germany, which scaled to €750,000 in two years.
Products & Services
Flat-knitted sweaters, polyester quilted jackets, washed-down cotton jackets, circular-knitted t-shirts, sweatshirts, joggers, sweatpants, infant clothing, and fly-knit shoe uppers.
Brand Portfolio
Active, Levi’s, Adidas, Skechers, Puma, Reebok, Jack & Jones, Vero Moda, ONLY, Pepe Jeans, United Colors of Benetton, Celio, Flying Machine, Arrow, Nike, and Tchibo.
New Products/Services
Recent launches include soft wovens, garment dyeing, and printing services. The company has also entered the footwear component market by manufacturing shoe uppers for Adidas, Skechers, and Reebok, diversifying away from pure apparel.
Market Expansion
Expansion plans focus on Tier II and Tier III cities in India, which are emerging as new retail hubs. Internationally, the company is leveraging FTAs (like India-UAE and India-Australia) to increase export competitiveness.
Market Share & Ranking
Active is the largest marketing partner for Levi's in the Northern Indian regions of Chandigarh, Punjab, J&K, and Himachal Pradesh.
Strategic Alliances
Maintains a 22-year strategic partnership with Levi Strauss India Limited. It also acts as a coordinated single-source solution for Tchibo’s Germany infant clothing business.
External Factors
Industry Trends
The Indian textile market is projected to grow at a 10% CAGR to USD 350 Billion by 2030. Trends include a shift toward organized retail, a boom in D2C models (growing 20%+), and the adoption of Industry 4.0 tools like 3D sampling to meet sustainability standards.
Competitive Landscape
Competes in a fragmented market but differentiates through 'ultra-premium' brand partnerships and fully compliant, state-of-the-art production facilities certified by GOTS and SA8000.
Competitive Moat
The primary moat is the 'design-to-shelf' model, being the only company in India to offer this end-to-end integration. This is sustained by 20+ year relationships with global brands like Levi's and high switching costs due to the technical complexity of flat-knit manufacturing.
Macro Economic Sensitivity
Highly sensitive to global inflationary pressures and consumer spending shifts in the US and Europe. The Indian textile industry contributes 2.3% to national GDP, making the company sensitive to domestic industrial policy.
Consumer Behavior
Shifting toward high-fashion streetwear, athleisure, and sustainable products. There is an increasing demand for 'speed-to-market' and digital integration in fashion procurement.
Geopolitical Risks
Trade barriers and tariff changes in the American market are cited as major disruptors to the industry's growth plans and export stability.
Regulatory & Governance
Industry Regulations
Operations are influenced by the 'PM MITRA Parks' scheme and the 'Samarth' scheme for skill development. Export operations are subject to international compliance standards and potential new FTAs with the EU and UK.
Environmental Compliance
The company is certified by global standards including GOTS (Global Organic Textile Standard), BCI (Better Cotton Initiative), and SA8000, ensuring alignment with ethical and eco-friendly production requirements.
Risk Analysis
Key Uncertainties
The primary uncertainty is the volatility of the American market and potential tariff disruptions, which could impact the maturity of current growth plans.
Geographic Concentration Risk
High concentration in Northern India for retail operations (Punjab, Chandigarh, J&K) and high export dependency on North America and Europe.
Third Party Dependencies
Significant dependency on the continued partnership with Levi Strauss India, which accounts for a substantial portion of revenue (INR 100 Cr).
Technology Obsolescence Risk
The company mitigates technology risk through continuous investment in Industry 4.0 tools, virtual knitting, and 3D sampling to stay ahead of traditional manufacturing competitors.
Credit & Counterparty Risk
The company maintains long-term relationships (12-15 years) with branded customers, suggesting stable receivables quality from established global entities like Adidas and Puma.