💰 Financial Performance

Revenue Growth by Segment

The company operates in a single segment, Jute Goods, which generated revenue of INR 267.93 Cr in H1 FY26, representing a 35.6% YoY growth compared to INR 197.56 Cr in H1 FY25. For the full year FY25, revenue was INR 439.43 Cr.

Geographic Revenue Split

Not disclosed in available documents, though the company serves both domestic and export markets.

Profitability Margins

Net Profit Margin for H1 FY26 was 16.25% (INR 43.55 Cr profit on INR 267.93 Cr revenue), a slight decline from 22.78% in H1 FY25. Operating margin for 9M FY25 was 10.64%.

EBITDA Margin

Operating margin stood at 10.64% for 9M FY25, compared to a target upward factor of 12-13%. EBITDA margin for H1 FY25 was estimated at 11.2%.

Capital Expenditure

Historical PPE purchase for FY25 was INR 17.20 Cr. For H1 FY26, the company spent INR 8.54 Cr on property, plant, and equipment and other intangible assets.

Credit Rating & Borrowing

The company maintains a strong financial risk profile with a gearing ratio of 0.01 times and total outside liabilities to networth of 0.08 times as of FY23. Borrowings were minimal at INR 5.03 Cr as of March 31, 2025.

⚙️ Operational Drivers

Raw Materials

Raw Jute is the primary raw material. Employee costs are also a significant driver, having increased with effect from February 2024.

Capacity Expansion

A new weaving unit was commissioned in fiscal 2023. Capacity utilization of this unit has been lower than expected due to muted export demand amidst global challenges.

Raw Material Costs

Not disclosed as a specific percentage of revenue, but the company focuses on containing the impact of rising employee costs through improved capacity utilization.

Manufacturing Efficiency

Capacity utilization of the new weaving unit is a key monitorable; lower-than-expected utilization has impacted recent performance.

📈 Strategic Growth

Expected Growth Rate

Not disclosed

Growth Strategy

Growth is targeted through the ramp-up of the new weaving unit commissioned in FY23, revival in domestic and export demand, and continuous technology upgrades to improve operating efficiency.

Products & Services

Jute Goods, including bags, yarn, and specialized jute products.

Brand Portfolio

Cheviot Group.

Market Expansion

Focusing on gradual revival in both domestic and export markets to strengthen market position.

Strategic Alliances

The company has no subsidiary, associate, or joint venture as of September 30, 2025.

🌍 External Factors

Industry Trends

The jute industry is evolving with a shift toward sustainable packaging, but faces competition from cheaper synthetic substitutes and regulatory risks.

Competitive Landscape

Key competitors include other jute mills and manufacturers of synthetic substitutes.

Competitive Moat

Moat includes extensive promoter experience since 1897, a strong financial risk profile with near-zero debt (gearing 0.01x), and a diversified product profile.

Macro Economic Sensitivity

Highly sensitive to global export demand and market sentiments, which have recently remained muted.

Consumer Behavior

Shift toward eco-friendly jute products is a positive trend, though price sensitivity leads to competition from cheaper alternatives.

Geopolitical Risks

Global challenges and muted export demand are cited as primary factors for lower capacity utilization.

⚖️ Regulatory & Governance

Industry Regulations

The jute industry is subject to high regulatory risks, including government procurement policies and environmental norms.

Taxation Policy Impact

Total tax expense for H1 FY26 was INR 12.66 Cr. The company had a net deferred tax liability of INR 25.10 Cr as of March 31, 2025.

Legal Contingencies

The company reported no unspent amounts for ongoing CSR projects required to be transferred under Section 135(6) of the Companies Act.

⚠️ Risk Analysis

Key Uncertainties

Significant exposure to market-linked investments (INR 310.80 Cr, or 43.57% of assets) creates volatility in earnings due to fair value changes.

Geographic Concentration Risk

Not disclosed, but the company has a wide distribution network for its jute goods.

Technology Obsolescence Risk

Mitigated by regular capex for technology upgrades and replacement of old machinery.

Credit & Counterparty Risk

Provision for doubtful balances was INR 0.35 Cr in FY25, indicating relatively high receivable quality.