Thanks for your input Sumit.
To quote @ramakanth "This comprehensive report by Motilal Oswal (http://www.researchbytes.com/Indo-Count-Industries-Limited-I0159.htm) clearly mentions that the revenue split is:
81% - bedding
16% - spinning and
3% - consumer goods and that going ahead they are focusing more on the bedding business and its various verticals."
With 84% (81+3) of revenue coming from non-spinning, cotton prices should not have a significant effect on their margins. Would you agree?
Moreover, for the bedding and consumer goods, the company should be able to pass on that increase in cotton prices to the consumer just like diesel/petrol prices go up and down with increase and decrease in crude prices. Is this assumption correct on my part?
I agree, Yuan depreciation is something that needs to be monitored. To counter that the recent incentives announced by Govt. of India should be able to cushion that for a couple of years. And with Chinese government manipulating Yuan, it is anybody's guess, which way it will move. But I agree, that Yuan depreciation should be monitored in order to get an early hint of an exit.