Sintex (Demerged) - textile business

Yes got it . Thanks !!

First the trading that goes through BVM is according to management inorder to offer full array of yarns to their customers while they do not manufacture synthetic yarns in house hence they source it from outside. It will earn them 0.5% - 1.5% EBITDA margins but in Q1 I think they made some loss on trading.

I think the Deferred Tax Liability will increase for next 4-5 years as CWIP gets transferred to Fixed Assets and depreciation from wdv method remains higher than slm. In future at some point Depreciation as per Income Tax (wdv method) will become less than what is calculated as per Company;s Act (SLM method) then this deferred tax liability will start reducing. But this will be in far distant future.

Apparently this is commonly followed in textile industry.

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Thanks a bunch! Was struggling to get my head around this trading business. Makes sense now.
If they really traded 800 Cr worth of synthetic yarn in 2018, they can possibly start manufacturing it.

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