Any current/future new fundraising through debt or equity?

Current gross debt is INR 189 crores with net debt of INR 162 crores due to Young Brand acquisition. For FY25, planned capex is around INR 40 crores, including investments in Sivakasi. No explicit mention of new fundraising through debt or equity in the current call. Debt has increased recently because of the Young Brand acquisition. The company appears focused on managing growth through internal accruals and strategic expansions (Sivakasi, Sri Lanka, Young Brand). No direct reference to impending equity issuance or debt raising plans was made in the transcript on page 17 or nearby pages.

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

Capex planned for FY25 is around INR 40 crores, including investments in the Sivakasi factory. Sivakasi greenfield expansion phase 1 will have 400 machines by December 2025; phase 2 will add another 400 machines later. Young Brand acquisition (completed on June 21) is a strategic investment, contributing INR 300 crores revenue and INR 32-35 crores EBITDA in FY25. Expansion plans include increasing capacity in existing setups, acquiring new factories (like Young Brand), and offshore production in Sri Lanka on a contract basis. Cross-selling opportunities between S.P. Apparels and Young

Future growth expectations in sales/revenue/volumes?

Growth driven by increased utilization of existing garment capacity and new production capacity additions, including the Sivakasi greenfield project and Sri Lanka operations. Young Brand acquisition expected to contribute around INR 300 crores revenue in FY25 with potential EBITDA margin of 15%-18%. Cross-selling opportunities with Young Brand and existing customers to boost sales, especially in U.S. and European markets. Capacity utilization targeted to reach 90%+ over next 4-6 months with consistent labor inflow and training. Sri Lanka operations running on contract model, expected to ramp u

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

Company expects growth driven by increased capacity utilization and new production capacity in the garment division, including the new Sivakasi facility adding 400 machines starting H2 FY25. Young Brand acquisition projected to contribute around INR 300 crores revenue and INR 32-35 crores EBITDA in FY25. Sri Lanka operations targeted to reach 1,000 machines by FY25-end, contributing positive returns. Garment division EBITDA margin for Q1FY25 stood at 17%; scope to improve margins via cost control, material sourcing, and operational efficiencies. Retail division aims to break even by end of FY2

Current/ Expected Orderbook/ Pending Orders?

Current order book for S.P. UK is GBP 4.4 million, with orders executable over the next few months (Q4 shipment expected in October-November). Young Brand's order book is around INR 75 crores, with Q1FY25 revenue of INR 59 crores. Orders for new Sri Lanka operations are pending customer audits; orders expected to start at month-end or early next month. Customer inquiries are high due to China Plus One strategy, but conversion takes time (1-2 years). Existing order book for expansion projects is ready; customers are underwriting factories. Capacity utilization expected to reach 90%+ w

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S P Apparels LtdQ2 FY24Textiles & Apparels

S P Apparels Ltd Q2 FY24 Earnings Call Analysis

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

Price: ₹1,038P/E: 17.3Market Cap: ₹2.0K CrSector: Textiles & Apparels

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

N/A

Order

N/A

Capex

Yes

1 of 3 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

→Growth driven by increased utilization of existing garment capacity and new production capacity additions, including the Sivakasi greenfield project and Sri Lanka operations.
→Young Brand acquisition expected to contribute around INR 300 crores revenue in FY25 with potential EBITDA margin of 15%-18%.
→Cross-selling opportunities with Young Brand and existing customers to boost sales, especially in U.S. and European markets.
→Capacity utilization targeted to reach 90%+ over next 4-6 months with consistent labor inflow and training.
→Sri Lanka operations running on contract model, expected to ramp up to 1,000 machines gradually.
→S.P. U.K. division aiming to double revenues in coming years with order book of GBP 4.4 million and positive EBITDA expected from Q3 FY25.
→Overall organic growth guidance remains around 10%, supported by new factory additions and market expansion.
→Increasing adult garment category share expected to improve average realizations over time.

Margin guidance

Category 3

→Company expects growth driven by increased capacity utilization and new production capacity in the garment division, including the new Sivakasi facility adding 400 machines starting H2 FY25.
→Young Brand acquisition projected to contribute around INR 300 crores revenue and INR 32-35 crores EBITDA in FY25.
→Sri Lanka operations targeted to reach 1,000 machines by FY25-end, contributing positive returns.
→Garment division EBITDA margin for Q1FY25 stood at 17%; scope to improve margins via cost control, material sourcing, and operational efficiencies.
→Retail division aims to break even by end of FY25, focusing on Crocodile and Angel & Rocket brands.
→S.P. UK segment expected to show positive EBITDA from Q3FY25 with order book visibility at GBP 4.4 million.
→EBIT margin improvements expected through cross-selling and organic growth.
→Management confident of achieving 10% organic growth and overall earnings growth despite short-term challenges.

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Fundraise plans

→Current gross debt is INR 189 crores with net debt of INR 162 crores due to Young Brand acquisition.
→For FY25, planned capex is around INR 40 crores, including investments in Sivakasi.
→No explicit mention of new fundraising through debt or equity in the current call.
→Debt has increased recently because of the Young Brand acquisition.
→The company appears focused on managing growth through internal accruals and strategic expansions (Sivakasi, Sri Lanka, Young Brand).
→No direct reference to impending equity issuance or debt raising plans was made in the transcript on page 17 or nearby pages.

Order book

→Current order book for S.P. UK is GBP 4.4 million, with orders executable over the next few months (Q4 shipment expected in October-November).
→Young Brand's order book is around INR 75 crores, with Q1FY25 revenue of INR 59 crores.
→Orders for new Sri Lanka operations are pending customer audits; orders expected to start at month-end or early next month.
→Customer inquiries are high due to China Plus One strategy, but conversion takes time (1-2 years).
→Existing order book for expansion projects is ready; customers are underwriting factories.
→Capacity utilization expected to reach 90%+ within 6 months, aided by increasing labor availability.
→Cross-selling opportunities expected to bring additional orders from both existing and new customers over 6 months.
→Order inflow expected to match or exceed outflow ensuring steady growth.

Capex plans

Yes

→Capex planned for FY25 is around INR 40 crores, including investments in the Sivakasi factory.
→Sivakasi greenfield expansion phase 1 will have 400 machines by December 2025; phase 2 will add another 400 machines later.
→Young Brand acquisition (completed on June 21) is a strategic investment, contributing INR 300 crores revenue and INR 32-35 crores EBITDA in FY25.
→Expansion plans include increasing capacity in existing setups, acquiring new factories (like Young Brand), and offshore production in Sri Lanka on a contract basis.
→Cross-selling opportunities between S.P. Apparels and Young Brand customers to leverage existing capacities.
→Efforts to enhance utilization by mobilizing and training workforce aiming for 90%+ capacity utilization in next 4-5 months.
→No immediate plans for new factories in Eastern India; growth will come from existing and acquired facilities.

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