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RATING

RECOMMENDATION

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Business Type

Traditional Business

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Unlisted Shares Essentials

ISIN

INE328E01027

Face Value

₹10.00

Total Share

39,46,560

Total Income

₹31,565.35 L

Profit After Tax

₹4,227.11 L

Promoter Holding

₹43.10 %

EPS

₹107.20

Book Value

₹25,459.04 L

Intrinsic Value

₹1,973.70

Sector

Consumer Discretionary

Sub-sector

Textile

Category

Listed on Regional Exchange

Cashflow - Operations

₹3,920.11 L

Cashflow - Financing

-₹5,508.74 L

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Growth

Compounded Sales Growth

  • -0.08%

    1 Year

  • 11.26%

    2 Year

  • 6.61%

    4 Year

Pro Only

Compounded Profit Growth

  • 112.60%

    1 Year

  • 68.34%

    3 Year

  • 26.29%

    4 Year

Pro Only

Return On Equity

  • 16.60%

    1 Year

  • -0.12%

    3 Year

  • 4.13%

    4 Year

Pro Only

About THE RAMARAJU SURGICAL COTTON MILLS LIMITED

  • The Ramaraju Surgical Cotton Mills, Ltd is part of the Ramco Group of companies. The group has an annual revenue of around USD 1.0 billion, manufacturing cotton and specialized yarns, cement, roofing and building products. The group also offers enterprise software solutions on the cloud.
  • The Ramaraju Surgical Cotton Mills was founded in 1939 in Rajapalayam, Tamil Nadu, to take advantage of the availability of the cotton grown by local farmers. The company, along with Rajapalayam Mills Ltd. that was established in 1935, were instrumental in transforming the region from an agrarian to an industrial society.
  • They are the largest producer of absorbent cotton, gauze, bandages and other wound-care products in Southern India. The monthly production capacity is over 125 tons of medical grade bleached cotton and over 1.5 million square meters of bandages and gauze products. Over the years they have diversified into spinning and weaving, producing some of the world’s finest cotton yarn and manufacturing premium fabrics for shirting, bed linens and Jacquard cloth. They produce nearly 400 tons of superfine count ring-spun yarn and about 400 tons of open-end yarn per month. Today they offer over 200 unique products with the help of a 2,200 strong workforce. The company well known for their quality products that meet or exceed customer expectations, which has helped us build a loyal base of satisfied customers spread across the globe.


Key Stats:

  • The Net Income (PAT) of the company grew significantly from INR 20 cr. to INR 42 cr. with a rate of 112.6%.
  • Operating income of the company has grown from INR 14.5 cr. in FY19 to INR 55.7 cr. in FY21 with a CAGR of 95.7%.

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Subsidiaries

Madras Chipboard Limited

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Revenue Segmentation

  • Textiles
  • Surgical
  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Product & Services

  • Yarn
  • Fabrics
  • Surgical Dressings
  • Waste Cotton

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Industry Overview

Industry Statistics

  • India’s textiles sector is one of the oldest industries in the Indian economy, dating back to several centuries. The industry is extremely varied, with hand-spun and hand-woven textiles sectors at one end of the spectrum, while the capital-intensive sophisticated mills sector on the other end. 
  • The decentralised power looms/ hosiery and knitting sector forms the largest component in the textiles sector. The close linkage of textiles industry to agriculture (for raw materials such as cotton) and the ancient culture and traditions of the country in terms of textiles makes it unique in comparison to other industries in the country.
  • The textiles sector has witnessed a spurt in investment during the last five years. The industry (including dyed and printed) attracted Foreign Direct Investment (FDI) worth US$ 3.75 billion from April 2000 to March 2021.

Future Prospects

  • India is working on major initiatives, to boost its technical textile industry. Owing to the pandemic, the demand for technical textiles in the form of PPE suits and equipment is on rise. 
  • Government is supporting the sector through funding and machinery sponsoring. Top players in the sector are attaining sustainability in their products by manufacturing textiles that use natural recyclable materials. 
  • The future for the Indian textiles industry looks promising, buoyed by strong domestic consumption as well as export demand. With consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade with the entry of several international players like Marks & Spencer, Guess and Next into the Indian market. 
  • High economic growth has resulted in higher disposable income. This has led to rise in demand for products creating a huge domestic market.

Government Initiatives

  • Indian government has come up with several export promotion policies for the textiles sector. It has also allowed 100% FDI in the sector under the automatic route. In April 2021, Union Minister Smriti Irani has assured strong support from the Textile Ministry to reduce industry’s dependence on imported machine tools by partnering with engineering organizations for machinery production. She also stated that the PLI scheme for the textile industry is almost ready. 
  • The scheme aims to develop Man Made Fiber (MMF) apparel and technical textiles industry by providing incentive from 3-15% on stipulated incremental turnover for five years. To support the handloom weavers/weaver entrepreneurs, the Weaver MUDRA Scheme was launched to provide margin money assistance at 20% of the loan amount subject to a maximum of Rs. 10,000 (US$ 134.22) per weaver. The loan is provided at an interest rate of 6% with credit guarantee of three years.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Awards & Achievements

The Government of Tamilnadu has awarded 3 Numbers of Prizes for the year 2009, 2010 and 2013 to The Ramaraju Surgical Cotton Mills Limited, Perumalpatti and also awarded 3 Number of Prizes for the year 2009, 2010 and 2011 to The Ramaraju Surgical Cotton Mills Limited, Rajapalayam under the Good Industrial Relations Award Scheme.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Strengths

  • The Net Income (PAT) of the company grew significantly from INR 20 cr. to INR 42 cr. with a rate of 112.6%.
  • Operating income of the company has grown from INR 14.5 cr. in FY19 to INR 55.7 cr. in FY21 with a CAGR of 95.7%.
  • Cash flow from Operations of the company has grown from INR 11.6 cr. in FY19 to INR 39.2 cr. in FY21 with a rate of 238.3%.
  • The separate financial results for the year ended 31st March, 2021 after charging all expenses and contribution to Ramaraju Memorial Fund of Rs. 70 Lakhs but before deducting finance cost and depreciation have resulted in EBITDA of Rs. 7,441.31 Lakhs against Rs. 5,433.82 Lakhs for the previous financial year 2019-20. After deducting Rs. 2,199.86 Lakhs towards finance cost and providing Rs. 1,752.86 Lakhs towards Depreciation, the Profit before Tax for the year is Rs. 3,488.59 Lakhs against profit of Rs. 1,002.09 Lakhs of the previous financial year 2019-20.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Shortcomings

  • The asset turnover ratio of the company fell from 56.5% to 54.5%, which signifies that the assets are underutilized when compared to its peers.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Opportunities

  • The future for the Indian textiles industry looks promising, buoyed by strong domestic consumption as well as export demand. 
  • With consumerism and disposable income on the rise, the retail sector has experienced a rapid growth in the past decade. 
  • More efficient utilization of their strong asset base will help increase profitability of the company.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Threats

  • Textile and apparel exports in 2020-2021 are almost 13% less (in dollar terms) than the previous year, provisional data available with the Cotton Textiles Export Promotion Council. The looming threat of 3rd wave of corona can hinder the growth due to logistic challenges.
THE RAMARAJU SURGICAL COTTON MILLS LIMITED Rating

  • RECOMMENDATION

    Buy

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Detail Info

Industry Statistics

PUBLIC LIMITED

Registered In

India

last Updated

03/09/2021

Registered Date

20/03/1939

Stock Exchange Ticker

RAMILL

Reg Office: 119, P.A.C. RAMASAMY RAJA SALAI, RAJAPALAYAM - 626 117, Tamilnadu, India

Website: http://www.ramarajusurgical.com/