SIDDHICOTS - Siddhi Cotspin

📊 NSE: SIDDHICOTS 🏢 Other Textile Products 📅 Last Updated: 11/13/2025 15:25

💰 Financial Performance

Revenue Growth by Segment

Total operating income grew by 187.78% YoY, rising from INR 201.85 Cr in FY23 to INR 580.89 Cr in FY24. Growth continued into 9MFY25 with the company achieving INR 650 Cr in revenue, surpassing the entire previous fiscal year's performance within nine months.

Geographic Revenue Split

Not disclosed in available documents, though manufacturing is centralized in Ahmedabad, Gujarat.

Profitability Margins

Net profit margin moderated from 2.99% in FY23 to 2.02% in FY24. Despite the margin dip, absolute PAT increased by 94.38% from INR 6.05 Cr to INR 11.76 Cr due to massive scale expansion.

EBITDA Margin

EBITDA margin declined from 13.61% in FY23 to 6.01% in FY24. This 760 bps reduction was a strategic trade-off to secure higher order volumes and increase market share.

Capital Expenditure

The company utilized INR 53.39 Cr from IPO proceeds for working capital (INR 25.10 Cr allocated) and debt repayment (INR 8.96 Cr allocated) to support its expanded scale.

Credit Rating & Borrowing

Ratings were upgraded in April 2025 to IVR BBB/Stable for long-term facilities (INR 55.94 Cr) and IVR A3+ for short-term facilities (INR 4.00 Cr), reflecting an improved financial risk profile.

⚙️ Operational Drivers

Raw Materials

Cotton is the primary raw material, accounting for the bulk of manufacturing costs for specialty cotton yarn.

Import Sources

Sourced locally from Ahmedabad, Gujarat, which is a major cotton-growing belt in India.

Capacity Expansion

Current installed capacity is ~9,012 MT per annum at the Dholi Integrated Spinning Park in Ahmedabad.

Raw Material Costs

Profitability is highly susceptible to cotton price volatility; however, the company employs an order-backed procurement policy to mitigate price risk.

Manufacturing Efficiency

Average fund-based working capital utilization was ~74% for the 12 months ending February 2025, indicating a moderate liquidity buffer.

Logistics & Distribution

Favorable plant location in Ahmedabad enables significant savings on logistics and distribution costs.

📈 Strategic Growth

Expected Growth Rate

49%

Growth Strategy

The company is pursuing a volume-led growth strategy, sacrificing short-term EBITDA margins (down to 6.01%) to secure larger orders and boost absolute profit levels. Growth is supported by the recent IPO which provided INR 25.10 Cr for working capital and INR 8.96 Cr for debt reduction.

Products & Services

Value-added and specialty cotton yarn.

Brand Portfolio

Siddhi Cotspin.

New Products/Services

Focus remains on value-added and specialty cotton yarn segments to differentiate from commoditized products.

Market Expansion

Expansion is driven by increasing sales volumes of yarn, as evidenced by the jump to INR 650 Cr revenue in 9MFY25.

Market Share & Ranking

Not disclosed in available documents, but operates in a highly fragmented industry.

🌍 External Factors

Industry Trends

The spinning industry is currently seeing a shift toward specialty and value-added yarns. While the industry is fragmented, Siddhi Cotspin is positioning itself through scale and location advantages in the Gujarat cotton belt.