Kitex Garments Limited

(Susindar) #1218

This article was the reason I searched for kitex in Amazon.

(Dinesh Sairam) #1219

Kitex sells online too, but the major source of their revenue is from their B2B business.

(kauban) #1220

Kitex Garments doesn’t sell in domestic market at the moment.

(Janarthanan Natarajan) #1221

After the Q3 results, there was an interview of Mr Sabu on ET Now(12th Feb). I couldn’t watch the interview(was on travel during that period) and I am not able to find it online too.

If someone had watched it, could you please be kind enough to post the summary of the same. Or if someone could pass the link to the video it would be even better. Thanks in advance.

(koti) #1222

1324acb6-7432-4e12-861f-8b5212a97e6d.pdf (150.2 KB)

(Janarthanan Natarajan) #1223

Mr Sabu has bought some more through open market purchase today too.

(AJ) #1224

This is interesting. Mr. Sabu continues to buy. 82K shares purchased today as per announcement to BSE. See below.

(SD007) #1225

(Sunny zen) #1226

Toys R Us files for liquidation, likely spelling its end in the U.S

(saumya) #1227

china general textile sector trends and problems

(saumya) #1228

us birth rate data and correct interpretation

(Paul Noel Singh) #1229

The article talks about the challenges faced by the garment industry:

(Dinesh Sairam) #1230

The article is about the broader garments industry. We cannot categorize kids’ clothing industry with the broader garments industry. Sure, Kitex is also constrained by the GST and exchange rate troubles, but it will pan out in the future. In fact, the most important fact that makes Kitex attractive as an investment is that it is not operating in the broader garments industry and never tried to get there.

(koti) #1231

KGL_BM_Outcome_250418.pdf (63.7 KB)
developments:1.incorporate 2 wholly owned subsidiary companies
2.Increase manufacturing capacity for future demand.
3.invest 400cr in companies through internal accruals and borrowings
4.KPMG involved for implementation of projects.

(bmathew) #1232

KGL has only one subsidiary - Kitex USA LLC ?? KCL is not a subsidiary ??

(Divyanshu Taneja) #1233

Results out but nothing found impressive. Profit lesser than previous year, cost of materials increased, employees cost also increased may be due to gratuity provosions, r toys filed for bankruptcy , kitex jas to take money from them

(Susindar) #1235

I find the results to be very poor. Both sales and profit are diving with YOY net profit down to 10cr from 26cr. Textile is among the most fragmented and commodified industry in India. On top of this, the textile industry has global competition and regulatory hurdles on the one hand. On the other hand, the buyers are some of the world’s largest chains with pricing power. So as such textile companies have very low moat in India and therefore in my opinion not for the long term unless there is some exceptional competitive advantage which I do not see any in Kitex.

(Dinesh Sairam) #1236

I would find it problematic to categorize Kitex into the larger textile industry (As I have mentioned just a few posts before). It sells niche products (Kidswear) which are partially recession proof.

The result is most definitely terrible and we should wait for the management to explain the reasons. Toys R Us filing for bankruptcy is going to be one of the reasons. We should fish for any other reasons that could have caused this. I don’t see any fundamental changes to Kitex’s long term performance.

By and large, Kitex still remains a ‘Buy’ in my eyes.

The only thing I am tracking about Kitex is their usage of excess cash for expansion in the south. The CEO has opined that they might be using a mix of cash and debt to fund the 500 Cr expansion.

(Gothamcapital) #1237

What about the management issues?Not identifying related parties correctly?Quantitatively yes it does look cheap.

(phreak) #1238

While infantswear might be recession proof, Kitex is just a supplier to other retailers. In this business costs matter a lot and there’s nothing very unique about what Kitex makes that it can’t be made by someone cheaper in Bangladesh or Vietnam. Infantswear exports market is growing faster in other countries like Vietnam and Cambodia and recently also in Bangladesh. India has been losing its market share and is not cost-competitive.

Some really great research about growth prospects has been done in this very thread last year and the year before which are very insightful. Do take a look at these at the very least.

One more addition from my side. This is cotton apparel exports from India to US and UK. You can see how similar Kitex’s topline trend is, to the overall garment exports from India.