Any current/future capex/capital investment/strategic investment?

RSWM has made a total investment of ₹725 Cr over the past two years: - ₹155 Cr in Melange yarn segment (30,000 spindles) - ₹155 Cr in Denim - ₹85 Cr in Knitting (Mordi, Banswara) - ₹315 Cr in Kaapas, Lodha project Additional investment proposals under consideration for modernization of the recently acquired Ginni Filament Chhata spinning plant machinery (25-30 years old), pending board approval. No major new CAPEX planned besides environmental improvements (ETPs and STPs) for addressing environmental risks. Focus on optimizing existing operations and new product development to impro

Future growth expectations in sales/revenue/volumes?

RSWM expects FY25 turnover around ₹5,000 crore, up from ₹4,057 crore in FY24 (±5%). Volume growth for FY25 is projected around 2,000 metric tonnes, including combined production from Chhata and Kaapas units. Kaapas unit expected to generate ₹500-600 crore revenue, contributing significantly to growth. Full capacity utilization at 80,016 spindles achieved, though some modernization investment is planned for quality improvements. Stable yarn prices anticipated in FY25 with reduced dumping of cheap polyester yarn benefiting domestic market. Denim production capacity utilization expected

Future growth expectations in earnings/operating earnings/profits/EPS?

RSWM expects profit margins to improve, aiming for margins in FY25 to be better than H2 FY24, supported by rejuvenation of the New Product Development segment and continuous cost optimization. The Kaapas project at Lodha, Banswara, is running well with better profitability, contributing higher value addition (~₹6-8/kg more than peers), and is expected to boost earnings further. The acquisition of Ginni Filament's Chhata unit will increase yarn output by 55 tonnes per day, adding capacity and contributing positively to turnover (~₹500-600 Cr) and profitability from FY25 onwards. Volume gr

Any current/future new fundraising through debt or equity?

RSWM Limited is **not planning any big expenditure related to risk management or other areas** except for ongoing environmental improvements via ETPs and STPs CAPEX. Regarding **debt management and capital allocation**, there is currently **no plan for major new fundraising through debt or equity**. Investments made recently amount to around ₹725 Cr over two years for capacity expansions, but no new large fundraising is indicated to fund these. No mention of planned equity issuance or large debt raising in the transcript for FY25 or upcoming quarters.

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RSWM LtdQ1 FY24Textiles & Apparels

RSWM Ltd Q1 FY24 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹192P/E: 11.8Market Cap: ₹734 CrSector: Textiles & Apparels

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Order

N/A

Capex

Yes

1 of 4 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→RSWM expects FY25 turnover around ₹5,000 crore, up from ₹4,057 crore in FY24 (±5%).
→Volume growth for FY25 is projected around 2,000 metric tonnes, including combined production from Chhata and Kaapas units.
→Kaapas unit expected to generate ₹500-600 crore revenue, contributing significantly to growth.
→Full capacity utilization at 80,016 spindles achieved, though some modernization investment is planned for quality improvements.
→Stable yarn prices anticipated in FY25 with reduced dumping of cheap polyester yarn benefiting domestic market.
→Denim production capacity utilization expected to improve, enhancing competitiveness.
→Knitting business with new Chhata unit close to Jewar Airport poised for growth, especially in export sales.
→Overall, management hopeful of better profit margins in H2 FY24, signaling positive future growth prospects.

Margin guidance

Category 3

→RSWM expects profit margins to improve, aiming for margins in FY25 to be better than H2 FY24, supported by rejuvenation of the New Product Development segment and continuous cost optimization.
→The Kaapas project at Lodha, Banswara, is running well with better profitability, contributing higher value addition (~₹6-8/kg more than peers), and is expected to boost earnings further.
→The acquisition of Ginni Filament's Chhata unit will increase yarn output by 55 tonnes per day, adding capacity and contributing positively to turnover (~₹500-600 Cr) and profitability from FY25 onwards.
→Volume growth for FY25 is estimated around 2000 metric tonnes from acquired units, with overall plant utilization running at high 90%.
→Capex focused on modernization and environmental improvements is expected to support operational efficiency.
→Unrealized mark to market gain of ₹138 Cr from Bhilwara Energy investment provides exceptional income impacting current earnings positively.
→Overall, EPS is expected to improve with operational growth, acquisition synergies, and better product mix.

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Fundraise plans

→RSWM Limited is **not planning any big expenditure related to risk management or other areas** except for ongoing environmental improvements via ETPs and STPs CAPEX.
→Regarding **debt management and capital allocation**, there is currently **no plan for major new fundraising through debt or equity**.
→Investments made recently amount to around ₹725 Cr over two years for capacity expansions, but no new large fundraising is indicated to fund these.
→No mention of planned equity issuance or large debt raising in the transcript for FY25 or upcoming quarters.

Order book

The transcript does not explicitly mention the current or expected order book or pending orders for RSWM Limited. However, inferred points related to demand and enquiries are: - There is a positive flow of enquiries for export sales in the Knitted fabric segment. - Conversion rate to bulk orders is currently very low due to pricing challenges. - Premium cotton product "Kaapas" has strong demand with repeat orders indicating customer satisfaction and loyalty. - Overall yarn and textile demand show a recovery with yarn prices expected to remain stable. - Reduced imports of cheap polyester yarn are expected to bolster domestic market volumes and realizations. - The company is working to liquidate stock levels, which reduced from 12,000 MT to 5,200 MT in Q4 FY24. - Acquisition expansions (Chhata, Lodha) will add capacity and support future sales growth. No specific quantitative order book or pending order numbers are disclosed in the transcript.

Capex plans

Yes

→RSWM has made a total investment of ₹725 Cr over the past two years:
→ - ₹155 Cr in Melange yarn segment (30,000 spindles)
→ - ₹155 Cr in Denim
→ - ₹85 Cr in Knitting (Mordi, Banswara)
→ - ₹315 Cr in Kaapas, Lodha project
→Additional investment proposals under consideration for modernization of the recently acquired Ginni Filament Chhata spinning plant machinery (25-30 years old), pending board approval.
→No major new CAPEX planned besides environmental improvements (ETPs and STPs) for addressing environmental risks.
→Focus on optimizing existing operations and new product development to improve margins.
→Kaapas project at Lodha started in Oct 2023, running profitably and expected to contribute significantly going forward.
→No large-scale debt management or other capex indicated currently.

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