🧠 At a Glance
Shiva Texyarn is a Coimbatore-based textile company with roots in cotton yarn manufacturing and tentacles in coated textiles, home furnishing, and now, solar energy (because why not?). The company has had a rollercoaster decade — from decent profits to deep losses and now trying to stitch things back together.
1. 🧵 WTF Do They Even Do?
- Core business: Hosiery-grade cotton yarn (52,416 spindles)
- Adjacent verticals:
- Technical textiles: Laminated & coated fabrics
- Home textiles
- Protective wear (for armed forces)
- Recent investment in solar firm (11.5% stake) ☀️
📍 Based in Tamil Nadu. Selling both B2B (domestic + export) and via institutional orders.
2. 📉 Financial Snapshot – FY25
| Metric | Value |
|---|---|
| Revenue | ₹323 Cr |
| Net Profit | ₹12 Cr |
| OPM | 10% |
| ROCE / ROE | 9.1% / 9.1% |
| EPS | ₹9.09 |
| Market Cap | ₹259 Cr |
| P/E Ratio | 21.9x |
| Book Value | ₹104 |
| CMP/BV | 1.9x |
🧠 After two bad years (FY23 & FY24), the company is back in black.
3. ⏳ The Comeback Chart
| FY | Sales (₹ Cr) | Net Profit (₹ Cr) | EPS | OPM % |
|---|---|---|---|---|
| FY22 | ₹477 | ₹20 | ₹15.4 | 12% |
| FY23 | ₹411 | ₹-7 | ₹-5.1 | 2% |
| FY24 | ₹335 | ₹-11 | ₹-8.5 | 3% |
| FY25 | ₹323 | ₹12 | ₹9.1 | 10% |
📈 Margins have recovered sharply in FY25. But sales have dropped for 3 straight years.
4. 📊 Quarterly Performance (Recent Q4 FY25)
| Quarter | Sales | OPM % | Net Profit | EPS |
|---|---|---|---|---|
| Q4 FY25 | ₹91.6 Cr | 9.8% | ₹6.2 Cr | ₹4.78 |
| Q3 FY25 | ₹75.3 Cr | 9.7% | ₹1.8 Cr | ₹1.39 |
| Q2 FY25 | ₹95.2 Cr | 10.4% | ₹2.5 Cr | ₹1.94 |
So profit’s growing quarter-on-quarter. But sales fluctuate more than Indian monsoons.
5. 💸 Valuation – Reasonable or Ripe?
- P/E: 21.9x
- EV/EBITDA (est): ~9–10x
- Dividend: ₹4.5/share (45%) — first one in years!
📌 Priced fairly if you believe in turnaround. But no evidence of growth yet.
6. 🧾 Balance Sheet – Not Bad, Not Fabulous
| Metric | FY25 Value |
|---|---|
| Equity | ₹13 Cr |
| Reserves | ₹122 Cr |
| Debt | ₹106 Cr |
| Net Worth | ₹135 Cr |
| D/E Ratio | ~0.78x |
⚠️ Company has brought debt under control, but still heavily leveraged for its size.
7. 🔁 Cash Flow Story
| FY | CFO (₹ Cr) | Capex (Est) | FCF |
|---|---|---|---|
| FY23 | ₹67 | ~₹6 | Strong |
| FY24 | ₹4 | Low | Weak |
| FY25 | ₹13 | Low | Improving |
💡 CFO recovered but still weak for a ₹300 Cr turnover company.
8. 🏭 Segment & Working Capital
- Inventory Days: 163 😱 (Used to be 99)
- Debtor Days: 46
- Payables: 52
- Cash Conversion Cycle: 157 days — way too high!
📦 Working capital mismanagement is a chronic issue.
9. 👬 Peer Comparison
| Company | P/E | ROE % | OPM % | Sales (Cr) | PAT (Cr) |
|---|---|---|---|---|---|
| Shiva Texyarn | 22x | 9.1% | 10% | ₹323 | ₹12 |
| Indo Count | 23x | 11.2% | 13% | ₹4,151 | ₹246 |
| Welspun Living | 21.7x | 13.7% | 12% | ₹10,545 | ₹639 |
| Vardhman Text. | 16.5x | 9.3% | 13% | ₹9,784 | ₹883 |
| Alok Ind | — | — | -2.4% | ₹3,708 | -₹910 |
📌 Shiva is tiny compared to peers. No exports advantage, scale, or brand.
10. 🔍 Shareholding Pattern
| Category | Mar 2025 |
|---|---|
| Promoters | 74.04% |
| Public | 25.96% |
| FII/DII | Basically 0% |
📉 No institutional interest, but strong promoter skin in the game.
11. ⚡ Solar Diversion – Strategic or Just “Startup Energy”?
- Acquired 11.5% stake in a solar firm in May 2025
- Management says it will aid “sustainability and diversification”
- Sounds more like buzzword investing unless backed by execution
☀️ No major capex or revenue announced from this yet.
12. 📌 EduInvesting Verdict™
“Textile margin recovery story meets smallcap solar fantasy”
But can it actually grow?
🟢 Good for:
- Value investors betting on turnaround
- Stable textile + solar optionality combo
- Those who prefer mid-margin consistency
🔴 Avoid if:
- You want revenue growth
- You want scale, liquidity, or brand-driven moats
- You hate waiting 3 years for 15% CAGR
💸 Fair Value Range: ₹150 – ₹180
Basis:
- EPS ~₹9
- P/E of 17–20x justified for slow-growth textile business
- Current price of ₹199 implies forward optimism not yet backed by topline
Tags: Shiva Texyarn, Cotton Yarn Stocks, Technical Textiles, Solar Diversification, Smallcap Turnaround, EduInvesting
✍️ Written by Prashant | 📅 July 3, 2025
