CELEBRITY - Celebrity Fash.

📊 NSE: CELEBRITY 🏢 Textiles - Products 📅 Last Updated: 12/13/2025 20:44

💰 Financial Performance

Revenue Growth by Segment

The company reported a 5.92% decline in total operating income from INR 364.24 Cr in FY23 to INR 342.66 Cr in FY24. In Q1 FY25, revenue plummeted by 63.2% YoY to INR 36.24 Cr due to the loss of a major customer who previously contributed over 60% of total revenue.

Geographic Revenue Split

The company has high geographic concentration with the United States accounting for over 80% of the order book as of August 2025. This makes the company highly sensitive to US trade policies and consumer demand shifts.

Profitability Margins

Net profit after tax (PAT) margins declined from 1.69% in FY23 to 0.54% in FY24. The company reported a PAT of INR 1.84 Cr in FY24, a 70.08% decrease from INR 6.15 Cr in FY23, driven by lower scale and intense competitive pressure.

EBITDA Margin

EBITDA margin was 5.65% for FY24 but turned to a negative 16.14% in Q1 FY25. This sharp decline is primarily due to poor fixed cost absorption following a significant reduction in the scale of operations.

Capital Expenditure

Historical capital expenditure details are not explicitly provided, but the company has been raising funds to repay preference shares (INR 5 Cr per annum) from FY22 to FY24 rather than for major capacity expansion.

Credit Rating & Borrowing

Ratings were downgraded in September 2025 to 'CRISIL B+/Stable/CRISIL A4' from 'CRISIL BB-/Stable/CRISIL A4+'. Borrowing costs are impacted by an average financial risk profile with an interest coverage ratio that fell from 2.99x in FY23 to 1.95x in FY24.

⚙️ Operational Drivers

Raw Materials

Woven cotton fabric and related textile trims represent the primary raw material costs, though specific percentage breakdowns per material are not disclosed in the available documents.

Capacity Expansion

Current capacity is not specified in MT or units; however, the company is currently focused on stabilizing operations rather than expansion, as EBITDA losses in FY25 have constrained capital for growth.

Raw Material Costs

Raw material costs are a significant portion of the operating expenses, and margins are currently under pressure due to a 63.2% drop in revenue which prevents efficient cost absorption.

Manufacturing Efficiency

Manufacturing efficiency has declined significantly in FY25, with negative EBITDA of 16.14% indicating that the current production volume is insufficient to cover fixed overheads.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

The company aims to achieve recovery through better order inflow from existing customers and the addition of new customers to replace the lost 60% revenue base. Strategic focus is on improving the operating margin to over 4% and stabilizing the capital structure to support cash accruals.

Products & Services

Readymade woven cotton garments for men and women, primarily for the export market.

Brand Portfolio

The company primarily operates as an exporter for international brands including Timberland, Northface, and LLBean.

Market Expansion

The company is looking to diversify its customer base to mitigate the impact of the recent major client loss, though specific target regions beyond the US are not detailed.

🌍 External Factors

Industry Trends

The readymade garment export industry is seeing a shift toward low-cost manufacturing hubs. CFL is positioned as an experienced player but faces disruption from lower-cost competitors in Bangladesh and Southeast Asia.

Competitive Landscape

Intense competition from both organized and unorganized players in India, Bangladesh, and Southeast Asia, which limits scalability and profitability.

Competitive Moat

The company's moat is based on the 20-year experience of its promoters and established relationships with premium global brands. However, this moat is currently weakened by the loss of a major revenue contributor and low pricing power.

Macro Economic Sensitivity

Highly sensitive to global trade dynamics and US economic health, as 80% of the order book is US-based.

Consumer Behavior

Demand is driven by global apparel trends and consumer spending in the US; a slowdown in these regions directly impacts order inflows.

Geopolitical Risks

Exposure to international trade barriers and global tariffs is a key monitorable, especially given the high concentration of exports to the US market.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to international manufacturing standards required by global brands and export-import regulations between India and the US.

Legal Contingencies

The company faces potential risks from the materialization of contingent liabilities, which could significantly deteriorate the financial risk profile and liquidity, though specific INR values for pending cases are not provided.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the ability to replace the 60% revenue gap left by a major customer exit. Failure to do so will lead to continued negative cash accruals (currently insufficient to cover debt obligations).