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Discover and get a complete analysis on Ramaraju Surgical Cotton Mills Limited - Management, Business Model, Financials, Growth, Valuations, Funding Rounds, News and get the latest updates on Ramaraju Surgical Cotton Upcoming IPO.

ISIN

INE328E01027

Face Value

₹10.00

Total Share

39,46,560

Total Income

₹314.74 Cr

Profit After Tax

₹42.27 Cr

EPS

₹107.20

P/E

5.60

P/B

0.93

Market Capitalisation

₹236.79 Cr

Enterprise Value

₹506.31 Cr

Book Value

₹645.09

Intrinsic Value

₹2,425.00

Dividend Yield

0.08 %

Earnings Yield

17.87 %

Sector

Consumer Discretionary

Sub-sector

Textile

Category

Listed on Small Exchange

Cashflow - Operations

₹39.20 Cr

Cashflow - Financing

-₹55.09 Cr

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Growth

Compounded Sales Growth

  • -3.94%

    1 Year

  • 3.83%

    5 Year

  • 4.21%

    9 Year

Pro Only

Compounded Profit Growth

  • 112.60%

    1 Year

  • 41.76%

    5 Year

  • NA

    9 Year

Pro Only

Return On Equity

  • 16.60%

    2021

  • 2.04%

    2017

  • 81.04%

    2013

Pro Only

About THE RAMARAJU SURGICAL COTTON MILLS LIMITED

  • Ramaraju Surgical Cotton Mills, is a subsidiary of the Ramco Group. The company makes cotton and specialty yarns, as well as cement, roofing, and construction materials.  It offers absorbent cotton wool for cleaning and swabbing wounds, and medicaments to wounds; cotton wool balls that are used in cleaning the wounds and for green rooms; cotton wool zig zag (pleats); and absorbent gauze for packing open wounds.
  • The company also provides gauze swabs/sponges for wound dressing, general cleaning, and minor pepping applications; pre-cut gauze products for hospital and clinics; laparotomy sponges; grey gauze (jumbo rolls); bleached gauze (jumbo rolls); and surgical bandages for orthopedic purposes. In addition, it offers roller bandages for external dressing and orthopedic purposes; triangular calico bandages that are used in arm slings, binder for splints, and torniquets; plaster of Paris powders for medical, dental, and commercial markets; and plaster of Paris bandages. 
  • In Southern India, they are the main producer of absorbent cotton, gauze, bandages, and other wound-care goods. Over 125 tonnes of medical-grade bleached cotton and 1.5 million square metres of bandages and gauze products are produced monthly. They've expanded into spinning and weaving throughout the years, creating some of the best cotton yarn in the world and luxury textiles for shirting, bed linens, and Jacquard cloth. Each month, they create almost 400 tonnes of superfine count ring-spun yarn and around 400 tonnes of open-end yarn. With the support of a 2,200-strong crew, they offer over 200 goods. 
  • The Ramaraju Surgical Cotton Mills Ltd. was formerly known as The Surgical Cotton Mills Ltd. and changed its name to The Ramaraju Surgical Cotton Mills Ltd. in June 1943.
  • The Ramaraju Surgical Cotton Mills started in Rajapalayam, Tamil Nadu, in 1939 to take advantage of the local farmers' cotton. Along with Rajapalayam Mills Ltd., which was founded in 1935, the company was essential in converting the region from an agrarian to an industrial civilization.

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED IPO Details

  • The company is listed on Metropolitan stock exchange but it is not trading as of know. The last price at which company stock traded was Rs.182.80.
  • The company hasn't filed DRHP as of know.

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Merger & Acquisition

Acquisition

  • On 31 March 2021, the company has acquired 1770 shares of M/s Madras Chip Board Limited constituting to 7.32% of its paid up share capital as per the resolution passed in the Extra-Ordinary General Meeting held on 25 January, 2021. Consequent to the acquisition, the total shareholding of the  Company in M/s Madras Chip Board Limited is 15,644 shares constituting 65 % of its paid up share capital. This acquisition will help the company to increase its market share and expand its business in different sector.

Investments

  • During FY21-22, the company would invest Rs.25Cr. in total (Spinning Rs. 20Cr., Weaving Rs.1.50Cr, and Surgical Rs 3.50Cr) as part of its ongoing expansion and modernization program.

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Subsidiaries

Subsidiary:

  • Madras Chipboard Limited

Associate Companies :

The Company has 7 Associate Companies:

  • The Ramco Cements Limited 
  • Ramco Industries Limited
  • Ramco Systems Limited
  • Shri Harini Textiles Limited
  • Shri Harini Media Limited.
  • Rajapalayam Mills Limited
  •  Sri Vishnu Shankar Mill Limited

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Business Model

The company is in the manufacturing business of cotton, gauze, bandages and other wound-care products and earn money from them.

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Revenue Segmentation

  • Yarn
  • Fabrics
  • Surgical Dressings
  • Waste Cotton

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Product & Services

Products:

  • Yarn
  • Fabrics
  • Surgical Dressings
  • Waste Cotton

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Assets

Tangible Assets as on 31 March 2021:

Assets Amount in Cr.
LandRs.22
BuildingsRs.46
Plant and MachineryRs.165
Electrical MachineryRs.9
FurnitureRs.1.14
VehiclesRs.1.36

 Intangible Assets as on 31 March 2021:

AssetsAmount in Cr.
SoftwareRs.6

  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Industry Overview

Industry Statistics

  • The textile industry in India is one of the nation's oldest, having existed for several centuries. The industry is tremendously diverse, ranging from hand-spun and hand-woven textiles to capital-intensive complex mills on the other end of the spectrum. The textiles sector is dominated by the decentralized power looms/hosiery and knitting sector.
  • Textiles are distinct from other industries in the country because of their tight ties to agriculture (for raw materials such as cotton) and the country's old history and customs in terms of textiles. India's textile sector has the capacity to create a wide range of products appropriate for a variety of market segments, both domestically and internationally. The Indian textile sector benefits from old know-how, abundant raw materials, highly skilled labour, and favourable demographics.
  • According to EMIS industry report India's textiles and clothing industry accounts for 2.3% of the country's GDP, 13% of industrial production, and 12% of total exports. After agriculture, the textile sector is the country's second-largest employer.

Market Size:

  • India is one of the world's leading producers of cotton and jute. India is also the world's second largest producer of silk, accounting for 95% of all hand-woven cloth. The Indian technical textiles market is about $16 Bn., or around 6% of the global market.
  • India's domestic textile and apparel industry was valued USD 77Bn. in FY21, according to Welspun India, and is predicted to increase at a CAGR of 19.8% to USD 190Bn. by FY26. The textile industry has benefited from the government's broad growth-oriented programmes.
  • The Indian textile industry, which includes traditional sectors such as handloom, handicrafts, and small-scale power-loom facilities, employs millions of people in rural and semi-urban areas. It employs approximately 45Mn. people directly and indirectly supports over 100Mn. people, including many women and rural Indians. The government is extensively investing in the industry through programmes including Make in India, Skill India, Women Empowerment, and Rural Youth Employment.

Share of India's textile exports:



  • The textiles and apparel industry in India is the country's second largest employer, employing 45 Mn people directly and another 100 Mn in affiliated businesses.
  • India has also surpassed China as the world's second-largest producer of personal protective equipment (PPE). More than 600 firms in India are approved to manufacture personal protective equipment (PPEs), with a global market worth of more than $92.5 Bn. by FY25, up from $52.7 Bn in FY19.


No. of Textiles Parks in different states (source: Invest India):



Growth Drivers:

  • There is an abundance of raw materials, as well as the presence of full value chains. Affordability of skilled labour, Increased focus on technical textiles as a result of the growth of end-user industries such as automotive, healthcare, infrastructure, and oil and petroleum, as well as the Production-Linked Incentive (PLI) Scheme in Man-made Fiber and Technical Textiles with a financial outlay of INR 10,683 Cr under the Atmanirbhar Bharat package, are key growth drivers for the textile industry.

Key Trends:

  • 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. 
Peers:
  • Loyal textile, Precot ltd. are some of the peers of the company.

Future Prospects

  • India's domestic textile and apparel industry was valued USD 77 Bn in FY21, according to Welspun India, and is predicted to increase at a CAGR of 20% to USD190Bn. by FY26. In FY21, India's clothing demand was USD 55Bn, accounting for 71% of the country's entire textile and apparel market. Favorable demographic variables such as a growing young population, rising disposable incomes, fast urbanization, and rising living standards, among others, will promote textile demand growth. Textile and clothing demand will be fueled by the increasing growth of ecommerce and digitization. Growing family income, rising population, and more sales in end-use industries such as housing and hospitality will all help the home textiles segment thrive.


Government Initiatives

Government Regulator:

  • Ministry of Textiles - The Ministry of Textiles is the Indian government's national agency in charge of the textile industry's policy, planning, development, export promotion, and regulation. This category comprises all natural, synthetic, and cellulosic fibres used in textiles, apparel, and handicrafts. 
  • Production Linked Incentive (PLI) Scheme - The Union Cabinet, led by Prime Minister Shri Narendra Modi, has approved the introduction of the Production-Linked Incentive (PLI) Scheme in Textiles Products for Improving India's Manufacturing Capabilities and Exports – Atmanirbhar Bharat.
  • 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

  • In the previous five years, the company has grown by 33% y-o-y and created profits for its owners.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Shortcomings

  • The company owes more than 250 crores in total debt, which considers to be the biggest risk of the company.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Opportunities

  • Raw material supply is abundant, which helps industry control prices and shorten lead times across the board.
  • The availability of low-cost and skilled labour gives industry a competitive advantage.
  • More efficient utilization of their strong asset base will help increase profitability of the company.

THE RAMARAJU SURGICAL COTTON MILLS LIMITED Threats

  • According to preliminary figures from the Cotton Textiles Export Promotion Council, textile and apparel shipments in FY21 will be around 13% lower (in dollar terms) than the last financial year FY20. The prospect of a third wave of corona could stifle growth owing to logistical issues.
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

03/03/2022

Registered Date

20/03/1939

Planify Ticker

Ramaraju

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

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

Frequently Ask Questions

The company has not filed any DRHP for the IPO as of now.

The face value of the company is Rs.10

Yes, we can expect good profit in the future.

The promoter of the company hold major shareholding of the company.

Shri P.R. Venketrama Raja is the Chairman and Owner of the company

In the previous five years, the company has grown by 33% y-o-y and created profits for its owners.

The minimum holding period after the company has been listed is 6 months

In FY21 company generated total profit of Rs.42 Cr.

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  • THE RAMARAJU SURGICAL COTTON MILLS LIMITED Share Price

  • ₹600.00

  • PLACE ORDER
  • ROFR Required

Available in Depository

  • NSDL

  • CDSL

Available for Investment

  • Primary

  • Secondary

  • Investment Checklist

Management

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Valuation