Sutlej Textiles and Industries Limited has submitted the transcript of its earnings conference call for the quarter and year ended 31 March 2025, held on 9 May 2025.
Key financial highlights discussed in the call:
- Q4 FY25 Consolidated Total Income: ₹686 crore (up 3% YoY)
- Q4 FY25 EBITDA: ₹16 crore (vs ₹13 crore in Q4 FY24)
- Q4 FY25 PAT: minus ₹13 crore (vs loss of ₹26 crore in Q4 FY24)
- FY25 Consolidated Total Income: ₹2,699 crore (vs ₹2,727 crore in FY24)
- FY25 Gross Margin improved by over 12% to ₹1,149 crore.
- FY25 EBITDA: ₹65 crore (vs minus ₹13 crore in FY24)
- FY25 PAT: minus ₹68 crore (vs minus ₹136 crore in FY24)
- Debt-equity ratio is at 0.97.
Management commentary included:
- Q4 FY25 performance was better than the corresponding quarter last year, reflecting strategic initiatives.
- Focus on reducing operational costs and improving efficiencies helped improve FY25 EBITDA significantly.
- A cautious 'wait and watch' approach is being maintained due to global and geopolitical uncertainties.
- Continuously working on cost optimization and strengthening the balance sheet.
- Logistical disruptions have eased, stabilizing raw material flows and export timelines.
- Opportunities from the India-UK free trade agreement were highlighted, particularly for the home textile business, where it could potentially triple business from a small base.
- Talks for an India-EU FTA are ongoing.
- The global textile cycle and apparel trade are expected to grow.
- Strategy involves refining the product mix, moving from apparel-focused yarn to exploring other segments like carpet, automotive, and technical textiles, and expanding the home textile business.
- Aiming to move from commodity yarn to more value-added products.
- The fiber business (Poly-PET conversion) is stabilizing and working at full capacity (80% for internal use).
- Adopted a highly cautious approach due to recent India-Pakistan tensions, prioritizing stability.
- Focus for FY26 is to maintain operational resilience and pursue incremental improvements.
- CAPEX is focused on upgrading infrastructure and machines for cost competitiveness and product requirements; weaving capacity for home textiles can be leased.
- Acknowledged logistical challenges for yarn exports to Bangladesh via land route (exploring sea option) and pricing pressure in the domestic market.
- Believes India is poised to grow in apparel trade due to geography mitigation strategies by global retailers and India's integrated cotton supply chain.