Nahar Spinning Mills Ltd Q2 FY26 – From Yarn Dreams to Threadbare Margins: How 5.73 Lakh Spindles Are Still Spinning Stories of Hope and Headaches
1. At a Glance
If textile companies were stand-up comedians, Nahar Spinning Mills Ltd (NSML) would be the one who walks on stage in a crisp linen shirt, cracks a few jokes about cotton prices, and then admits—“guys, we’re just breaking even.” With a market cap of ₹731 crore, current price ₹203, and a P/E of 20, this Ludhiana-based yarn giant isn’t exactly “threadbare,” but definitely not silky-smooth either.
The company’s Q2 FY26 results were as wrinkled as an old kurta—Revenue ₹779 crore, almost flat YoY, but the PAT slipped to a loss of ₹4.64 crore, a sharp turn from profit in earlier quarters. OPM slid to 3.31%, showing that even after decades of spinning experience, margin control is as slippery as raw cotton in monsoon.
The stock trades at 0.48x its book value—which is basically the market saying, “You’ve got assets, bro, but show us profits.” Debt sits at ₹760 crore (D/E 0.5), and return metrics are on life support: ROE 0.71%, ROCE 3.71%. Yet, promoters cling tight with 67.42% holding, proving that the Oswal family still believes in their spinning saga, even if investors are losing patience faster than a broken loom.
2. Introduction
Once upon a time, Punjab’s textile belt was buzzing with looms, and Nahar Spinning Mills was its proud flagbearer. Founded in 1980, when bell bottoms were in fashion and polyester was a luxury, the company has since grown into a global spinner with over 5.73 lakh spindles, 1080 rotors, and 768 air-jet spindles.
But here’s the twist: in an industry where margins flutter like a cotton flag in a storm, Nahar’s latest results tell a tale of resilience wrapped in exhaustion. The management has spent over ₹2,200 crore on expansion and modernization recently—most financed through loans—just to keep the spindle speeds up. The result? A company that’s spinning faster, but not necessarily earning better.
And yet, you can’t dismiss them. Nahar isn’t just making yarn—it’s exporting dreams to Bangladesh, China, Egypt, and Vietnam. About 53% of its revenue comes from exports, proving that the world still wants Indian cotton, even if India’s power bills don’t want to cooperate.
Still, with a flat topline, a declining profit, and rising costs, NSML feels like that friend who spent all his salary upgrading his gym shoes but still can’t run faster. The fundamentals are strong, the infrastructure is world-class, but the earnings… well, they’re on a diet.
3. Business Model – WTF Do They Even Do?
Let’s break it down without jargon—Nahar Spinning Mills takes cotton, spins it into yarn, and sometimes turns that yarn into knitted garments. That’s it. Simple. But the simplicity hides the scale: it’s one of India’s largest cotton and blended yarn manufacturers and a key exporter of hosiery knitwear.
Their ecosystem covers:
Spinning units at Ludhiana, Jitwal Kalan, Jodhan, Lalru (Punjab), and Mandideep & Raisen (MP).
Activities ranging from spinning to mercerizing, dyeing, knitting, and garmenting.
Power generation through two captive co-generation plants (3.8 MW and 4.8 MW) plus solar systems totalling 2.9 MW. Because when the grid plays hide and seek, Nahar just says, “We’ll make our own light.”
The latest ₹350 crore modernization (announced in FY25–26) aims to replace old spindles with high-efficiency ones and expand solar capacity to 11 MW. Management promises this will reduce costs and carbon footprint. Investors, however, are waiting for proof that this “green yarn” won’t just be more greenwashing.
In FY24, 96% of revenue came from product sales, 3% from export incentives, and 1% from services—so, no “other income jugglery” here. But the key problem? Margins. The company operates in a sector where prices change faster than political alliances.
So yes, they spin yarns—but the storylines are full of suspense.
4. Financials Overview
Let’s zoom into the Quarterly Results. All figures in ₹ crore.
Metric
Latest Qtr (Sep’25)
YoY Qtr (Sep’24)
Prev Qtr (Jun’25)
YoY %
QoQ %
Revenue
779.27
775.92
819.28
+0.43%
-4.89%
EBITDA
25.79
4.54
57.96
+469%
-55.5%
PAT
-4.64
-17.46
15.96
+73%
-129%
EPS (₹)
-1.29
-4.84
4.42
+73%
-129%
Witty commentary time: That EBITDA jump looks good, but before you pop the champagne—note the PAT slipped back into red. Essentially, Nahar’s results are like a cricket batsman hitting boundaries after a duck: promising, but inconsistent. Revenue is stagnant, showing the market saturation in yarn exports. The tiny 0.43% YoY growth is basically inflation-adjusted nothingness.
Annualized EPS based on this quarter = (-1.29 × 4) = -₹5.16. So yeah, on paper, a
