DSIJ Mindshare

Mandhana Industries posts flat results

Mandhana Industries, a textile company engaged in the manufacturing of textiles and garment, has posted marginal growth of 3.86 per cent in net profit at Rs 15.9 crore for the quarter ended March 31, 2016 as against Rs 15.34 crore in the corresponding quarter of the previous year.

The company’s revenue has marginally grown by 5.86 per cent at Rs 472.3 crore in Q4FY16. Its operating profit (EBITDA) has grown by 11.08 per cent at Rs 67.68 crore along with operating profit margin expanding by 67 bps for the current quarter, i.e. at 14.33 per cent. Other Income has de-grown by 23.9 per cent to Rs 2.13 crore in Q4FY16 as against Rs 2.81 crore in the corresponding period of the previous year.

For the entire period of FY16, it has reported 8.92 per cent de-growth in net profit of Rs 57.13 crore, and its revenue has been reported at Rs 1,646.6 crore. Its consolidated operating profit (EBITDA) has grown by 6.83 per cent at Rs 242.61 crore along with operating profit margin reporting flat at 14.73 per cent.

Mandhana signed an exclusive 18 years deal with Salman Khan Foundation for global license to design, manufacture, retail and distribute clothing under the flagship brand “Being Human”.

To unlock the value of the Company's Retail Operation segment, the Company has decided to demerge its retail business of brand "Being Human"‟ (“the Retail Business”) into a separate company viz. Mandhana Retail Ventures Limited (“MRVL”), to be listed post the demerger. Recently, the High Court of judicature at Bombay approved the scheme of arrangement for demerger of the retail undertaking of the company into Mandhana Retail Ventures. The shareholders of Mandhana Industries will get 2 (two) equity shares of MRVL for every 3 (three) equity shares of the company.

On the valuation front, it is currently trading at 18.20 times, price to earnings (P/E) ratio per share of Rs 17.25 as on March 31, 2016. Today, stock price closed lower by Rs 4.35 or 1.36 per cent at Rs 314.55 per share.

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