Q1 FY23 CONCALL 08 Aug 2022:
- Capex execution on track, Knitting and Weaving capacities to come within this financial year, spinning capacity will be added in Q1 and Q2 of the next financial year, new capacity can be fully utilized for man-made fibres also when required.
- Cost of debt long-term = 3% (state subsidized), new Debt will be at similar or lesser cost.
- Cotton price is 92000/candy, December Future @ 70000/candy
- Domestic cotton price is abnormally higher than the international cotton prices.
- Physical cotton not available domestically.
- It is uneconomical to sell the yarn by buying cotton at current market prices. As a result, during the quarter(Q2) expect the production to be lower.
- Current capacity Utilization:
- Spinning – 70%
- Weaving and Processing – 90%
- Knitting – 50% (Normally its 75-80%)
- Guidance
- Q2 will be hardly break-even quarter
- Q3 – Demand & Crop uncertainties still there
- Q4 – Can expect to be normal
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