BASML - Bannari Amm Spg.

📊 NSE: BASML 🏢 Textiles - Cotton/Blended 📅 Last Updated: 12/13/2025 19:05

💰 Financial Performance

Revenue Growth by Segment

Total Operating Income declined 15% YoY to INR 1,095.78 Cr in FY23 and further to INR 663.81 Cr in FY24. Segment contributions in FY23: Yarn (56.3%), Fabric (26.7%), Processing (4.1%), and Garments (4.9%).

Geographic Revenue Split

Domestic sales accounted for 96% of total income in FY23, while exports dropped significantly from 22% in FY22 to 4% in FY23 due to global demand slowdown.

Profitability Margins

Net Profit Margin was -2.73% in FY24 (Net Loss of INR 34.84 Cr in FY23) compared to 4.14% in FY22; Operating Profit Margin stood at 1.61% in FY24, projected to recover to 9.93% by FY25.

EBITDA Margin

PBILDT margin was 2.19% in FY23, a sharp decline from 11.64% in FY22, primarily due to high raw cotton prices and reduced capacity utilization.

Capital Expenditure

No major expansion planned; focus is on asset monetization including the sale of the garment unit and YBAPL subsidiary for INR 153 Cr to reduce debt.

Credit Rating & Borrowing

CARE BBB (Negative) / CARE A3+; interest coverage was weak at 0.50x in FY23 and 0.74x in FY24, indicating high sensitivity to borrowing costs.

⚙️ Operational Drivers

Raw Materials

Raw cotton is the primary raw material, representing the majority of input costs for the spinning and weaving operations.

Import Sources

Sourced domestically from Indian textile hubs; prices are heavily influenced by national Minimum Support Price (MSP) and monsoon vagaries.

Capacity Expansion

Current installed capacity: 145,440 spindles, 153 looms, 7,200 TPA knitting, and 5,400 TPA processing. Planned: Divestment of garment unit and YBAPL subsidiary.

Raw Material Costs

Susceptible to volatile cotton prices which increased significantly in H1FY23, leading to a net loss of INR 34.84 Cr in FY23; procurement is impacted by government MSP.

Manufacturing Efficiency

Working capital limit utilization averaged 78% over the 12 months ended February 2025; inventory turnover ratio was 2.92 in FY24.

📈 Strategic Growth

Expected Growth Rate

Not disclosed in available documents

Growth Strategy

Debt reduction through INR 153 Cr asset sale and INR 50 Cr rights issue to improve financial stability; exploring diversification into healthcare services.

Products & Services

Cotton yarn, woven fabric, knitted fabric, and garments (garment unit being divested).

Brand Portfolio

Bannari Amman Spinning Mills Limited (BASML).

New Products/Services

Proposal to venture into healthcare services is in nascent stages with no specific revenue contribution % yet defined.

Market Expansion

Targeting domestic textile hubs (Tirupur, Kolkata, Kanpur) and monitoring export markets (China, Bangladesh, Europe) for demand recovery.

Strategic Alliances

MoU with S.P. Apparels Limited for the sale of the garment unit and YBAPL subsidiary for INR 153 Cr.

🌍 External Factors

Industry Trends

Long-term demand supported by urbanization and government schemes like PLI and RoDTEP, despite near-term volatility in cotton prices.

Competitive Landscape

Pressured by high domestic cotton prices and global competition from other low-cost textile manufacturing hubs.

Competitive Moat

35-year operational history and promoter support from the Bannari Amman Group provide experience and funding support during liquidity crunches.

Macro Economic Sensitivity

Highly sensitive to global inflation and domestic cotton MSP; exports dropped by 18 percentage points in one year due to recessionary pressures.

Consumer Behavior

Increasing urbanization and rising disposable incomes in India are driving domestic demand for textiles and apparel.

Geopolitical Risks

Trade barriers and global demand shifts; however, the 'China + 1' strategy provides a potential long-term tailwind for Indian textile exports.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to cotton MSP, export quotas, and manufacturing standards; benefits from RoDTEP and RoSCTL schemes.

Environmental Compliance

ESG risks are currently noted as 'Not applicable' in the credit rating assessments for the current manufacturing scope.

Legal Contingencies

Pending litigations are disclosed in Note 38 of the standalone financial statements; no material foreseeable losses on long-term or derivative contracts reported.