Candour Techtex Ltd Q2 FY26 – From 6,700-Metre Defence Orders to 100,000-Metre Reliance Laminations: A Technical Textile Soap Opera With Polyester, Politics & Preferential Allotments
1. At a Glance
Candour Techtex Ltd, a ₹278 crore market cap microcap wonder, is the kind of stock that makes you question whether “technical textiles” means NASA-grade innovation or just very expensive mosquito nets. At ₹148 a share (as of December 10, 2025), this industrial textile player has been on a wild 107% joyride in the past three months. The stock trades at a P/B of 6.57, a PE that doesn’t exist (because earnings are negative), and a ROE that could barely beat a savings account at 2.18%.
In Q2 FY26, revenue nose-dived 74% YoY to ₹10.3 crore, while the company managed to turn a profit of ₹0.42 crore last year into a loss of ₹1.08 crore. Operating margins stand at a forgettable 1.36%, but hey — they did bag a ₹1 crore Reliance Industries lamination order and a defence trial order from ADRDE (Agra). That’s like saying your restaurant is running losses but at least Virat Kohli tried your samosa once.
With promoters trimming stake to 32.9% (down from 35.4%) and a preferential issue of ₹198 crore in the works, this quarter was less about making money and more about making headlines.
2. Introduction
Candour Techtex is the kind of company that turns up at an industry expo wearing all badges at once — agrotech, geotech, meditech, protech, sportech — and then asks if you’d like to see their forklift. Founded in 1986, the company has been stitching, coating, laminating, and occasionally reinventing itself for almost four decades.
They claim to do everything from bulletproof jackets to diaper fabric. One might say their range runs from “saving babies to saving soldiers.” Their plants in Ankleshwar (for velvet fabrics) and Nashik (for plastic moulded components) show they’re serious about making things — even if profitability occasionally takes a vacation in Goa.
In FY23, Candour sold its plastic division for ₹6.75 crore to a related party (Absolute Plastics Pvt. Ltd.), because, apparently, managing too many divisions was like juggling chainsaws while blindfolded. The latest moves — defence orders, Reliance laminations, ₹29 crore job work from ASK Apparels — show that the company is turning into a coatings and lamination specialist.
But before we pop the champagne, let’s remember the fine print: revenue has fallen 74% YoY, profit margins are thinner than a polyester thread, and EPS is firmly in the negative zone. Still, in a market that loves “futuristic” words like “technical textiles,” hope sells faster than fundamentals.
3. Business Model – WTF Do They Even Do?
Candour Techtex is like that friend who says, “I do a bit of everything.” From agrotech (shade nets, crop covers) to protech (bulletproof apparel), the product menu reads like a buffet that never ends. Their twelve verticals cover practically every imaginable fabric-based niche — from geo-bags to parachute cloths, conveyor belts to airbag materials.
On the machinery side, they trade in die-casting machines, metal-working equipment, and material-handling gear. Basically, if it moves, cuts, or covers something, they’ve got a version of it.
Their manufacturing base includes:
Ankleshwar (Gujarat): 1.2 million meters capacity for light velvet fabrics — the kind that decorates both your sofa and your portfolio if things go well.
Nashik (Maharashtra): 4,500-ton capacity for plastic moulded components — from battery casings to fruit crates.
New Project (in collaboration with a British partner): 24 lakh meters of coated and 55 lakh meters of laminated fabrics — a step toward higher-margin “technical” products.
However, since FY23, the focus is moving away from plastics to technical textiles and contract manufacturing for big brands. The ₹90 crore five-year contract with RITA International and ₹20 crore LOI from Faze Three Ltd reinforce this pivot.
In short: Candour Techtex is trying to evolve from a commodity-textile trader to a specialized manufacturer of high-performance materials. Whether that evolution is Darwinian or delusional remains to be seen.
4. Financials Overview
Let’s get the calculator and the sarcasm out together.
Quarterly Results (₹ crore)
Metric
Q2 FY26
Q2 FY25
Q1 FY26
YoY %
QoQ %
Revenue
10.29
39.76
33.67
-74.1%
-69.4%
EBITDA
0.14
2.09
-0.01
-93.3%
1,500% (small base joke)
PAT
-1.08
0.53
-0.92
-303.7%
-17.4%
EPS (₹)
-0.58
0.31
-0.49
-287%
-18%
If Excel could cry, this table would make it weep. Revenue collapsed 74%, PAT flipped negative, and EPS has become allergic to the color black.
Annualized EPS = -0.58 × 4 = -₹2.32, which means the P/E ratio is about as real as the Loch Ness Monster.
Still, the company managed to bag multiple orders worth over ₹140 crore (collectively), suggesting the slump is likely temporary. But for now, the quarterly results look like the financial equivalent of a car running on neutral.
5. Valuation Discussion – Fair Value Range (for educational purposes only)
Method 1: P/E Valuation Industry average P/E = 22.2 EPS = -1.31 (TTM), so P/E is meaningless here. To be generous, assume normalized EPS = ₹0.5 (post new orders). Then, Fair Value Range = ₹0.5 × (15–25) = ₹7.5 – ₹12.5 per share.
Method 2: EV/EBITDA EV = ₹294 crore EBITDA (TTM) = ₹3.94 crore EV/EBITDA = 74.5 (ouch). If industry range = 15–25×, fair enterprise value = ₹60–₹100 crore. That translates to ₹30–₹50 per share.
Method 3: Simplified DCF Assume cash flow grows from ₹6 crore to ₹15 crore in five years (thanks to new contracts). Discounting at 12%, fair equity value ≈ ₹250–₹300 crore.
