Hi Raj,
TPP is a potential threat for Kitex. Forget vietnam, why we are not seeing the threat from Singapore based Gimmell – which is the second largest manufacturer of infant wear after China’s Wingloo. It produces its own yarn and fabric, so the so called restrictive clause of having yarn and fabric from a member country is not applicable to them. They are already backward integrated. They have a good portfolio of brands already – having a good name in the global market. 15-30% duty on US imports is a major chunk which will surely shift the clients to the Singapore based company. Quality which we see as a barrier will not apply here, since gimmell ranks 2nd and Kitex ranks 3rd. Gimmell supplies to brands like Nike – proof of their quality. India needs to do something, else Kitex price is just going to tumble.
Apart from this, the cash issue worries me to a huge extent. I was ready to invest, just didnt because of this reason.
Where is the corporate governance gone – Mr. Sabu M Jacob??
The promoter keeps 250 cr idle in the listed company…and sets a 50:50 JV between his childrenwear and the listed company. If he is so great promoter, he should have invested all the 250 cr idle money in this US company and give the benefit to the investors.
Do not under estimate the promoter…He is also an equity research analyst..and has his own brokerage firm…till I know…He knows well..how to dress the financials and make them look lucrative…
I might be rude towards the promoter…but the fact makes my behaviour correct…
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