1. At a Glance – Old Mill, New Drama
A 1910-born textile mill now trading at ₹7,450 with a market cap of ₹519 Cr and a price-to-book of just 0.58x. Sounds cheap? Hold that thought.
Q3 FY26 revenue: ₹61.9 Cr
Q3 FY26 PAT: ₹2.04 Cr
OPM: 13.42%
ROCE: 0.86%
ROE: -0.60%
Debt: ₹134 Cr
3-month return: -12.4%
Yes, you read that right. A company that has survived World Wars, cotton cycles, GST, demonetisation and polyester fashion trends… is now making ₹2 Cr profit in a quarter and still struggling to generate decent returns on capital.
But wait — there’s a ₹91 Cr rental project approved. There’s arbitration drama. There’s production cut by 25% due to demand slowdown. There’s asset disposal of ₹70 Cr.
This is not just a textile company. This is a Tamil family business Netflix series.
Curious how a 115-year-old spinning mill balances yarn and real estate like a confused landlord? Let’s unwind the thread.
2. Introduction – From Spindles to Starbucks
Founded in 1910, Lakshmi Mills Company Ltd is one of the old guard of Indian textile manufacturing. The kind of company your grandfather might have worked for — and your broker might still be confused about.
They manufacture cotton and polyester-blended yarn. They trade in fabrics and garments. And now, they also rent out commercial property in Coimbatore hosting brands like Croma, Zudio, Starbucks, Miniso and Adidas.
Textiles contribute 94.5% of FY24 revenue. Rental services? A small 5.5%.
But sometimes the smallest segments carry the biggest valuation story. Ever noticed that?
The company employs over 2,000 people and produces yarn counts from 60s to 100s. Their Palladam and Kovilpatti units together house more than 1.3 lakh spindles and produce around 23 tons of yarn daily.
But here’s the twist — in June 2024, the company reduced production by 25% due to demand decline.
So the mill that once ran full steam is now turning slower.
Is it cyclical pain? Or structural stress? Or just cotton prices playing musical chairs again?
Let’s investigate like a slightly sarcastic textile detective.
3. Business Model – WTF Do They Even Do?
Let’s simplify.
