1. At a Glance – Spindle-Speed Headlines
If cotton yarn had a reality show, Lagnam Spintex would be that contestant who bulked up fast, took on debt like a gym bro on protein shakes, and now everyone’s staring at the interest bill wondering whether the gains are real or just lighting + pump.
Market cap sits around ₹132 Cr, while FY25 revenue touched ₹606 Cr — yes, sales are 4.5x market cap, which on Dalal Street usually screams “deep value”… or “deep trouble.” Stock trades near ₹75, down ~37% over one year, despite Q3 FY26 PAT jumping 57% YoY to ₹3.69 Cr.
The headline act? A ₹218 Cr capex that doubled capacity to ~70 tons per day, commissioned ahead of schedule. The villain? Debt of ₹388 Cr, promoter pledge at 48.2%, and interest coverage gasping at 1.63x.
Low P/E (9x), low Price/Sales (0.22), but also low ROCE (~10%). Is this a turnaround yarn or just tangled threads? Let’s pull the fabric apart.
2. Introduction – Welcome to the Cotton Cycle Gym
Textiles is that one industry where everyone knows cycles exist, but still gets surprised every time margins vanish faster than cotton in a bonfire. Lagnam Spintex entered this arena in 2010 and chose a very specific lane: 100% cotton yarn, no fancy synthetics cosplay, no polyester drama.
Over the last decade, the company grew sales at a ~28% CAGR, which is no joke for spinning. But profits? That story is more like a Bollywood sequel — sometimes blockbuster, sometimes straight-to-OTT disaster.
FY22 was the golden year with ₹29 Cr PAT. Then cotton prices cooled, demand softened, and margins sobered up. FY25 PAT came in at ~₹13–15 Cr territory. And just when investors were about to label it “one-cycle wonder,” management went full YOLO with
a ₹218 Cr expansion.
Now the company has scale. The question is simple: Can scale + cycle = sustainable returns? Or is this just a bigger spinning wheel with the same old headaches?
3. Business Model – WTF Do They Even Do?
In simple words: they buy cotton, spin it really fast, and sell yarn.
In investor words: they manufacture 100% cotton ring-spun and open-end yarn across Ne 4 to Ne 40 counts.
What They Sell
- Ring-spun & compact yarn (carded & combed)
- Open-end yarn (low twist, high RKM)
- Slub, siro, organic, BCI-certified yarns
- Yarn for direct dyeing (soft packages)
This feeds into:
- Denim
- Home textiles
- Terry towels
- Shirting, sheeting
- Knitting applications
Where They Sell
- Exports ~47% (Portugal, Italy, Turkey, Egypt, Bangladesh, etc.)
- Domestic ~53%
They are also a 2-Star Export House (FY21–FY26) — not a vanity badge, but it helps credibility with global buyers.
Capacity
- Old capacity: ~35 TPD
- Post-expansion: ~70 TPD
- Hardware: 25,536 + 41,472 spindles, 1,920 rotors
In cotton spinning, capacity is destiny. Utilisation + margins decide whether you print money or burn it politely.
4. Financials Overview – Numbers Don’t Lie, But They Do Smirk
Quarterly Performance (₹ Cr)
| Metric | Latest Qtr (Dec FY26) | YoY Qtr (Dec FY25) | Prev Qtr (Sep FY26) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 152.80 | 148.39 | 132.43 | +3.0% | +15.4% |
| EBITDA | 16.75 | 15.13 | 11.87 | +10.7% | +41.1% |
| PAT | 3.69 | 2.35 | 0.38 | +57.0% | +871% |
| EPS (₹) | 2.09 | 1.33 | 0.22 | +57.0% | 🤯 |
