Indo Count surges 8%; stock nears record high on strong Q2 results

The company registered its highest-ever quarterly revenue, volumes and Ebitda during the September quarter.

Shares of Indo Count Industries surged 8 per cent hitting a fresh 52-week high of Rs 302.05 on the BSE in Tuesday’s intra-day trade after the company reported strong September quarter earnings, with highest-ever quarterly revenue, volumes and Ebitda (earnings before interest, taxes, depreciation, and amortization).

The stock of the largest global home textile bed linen company was quoting at its highest level since October 2021. It had hit a record high of Rs 315 on October 11, 2021.

At 09:39 AM; the stock was trading 3 per cent higher at Rs 289, as compared to 0.31 per cent decline in the S&P BSE Sensex.

Indo Count’s total revenue crossed Rs 1,000 mark for the first time in its history, up 22 per cent year-on-year (YoY) at Rs 1,033 crore during the quarter. Volume increased by 23 per cent YoY at 28.7 million meters.

The company’s Ebitda rose 58 per cent YoY at Rs 189 crore, margins improved 420 bps to 18.3 per cent from 14.1 per cent in a year ago quarter. Higher volumes and efficient cost management led to operating leverage, the management said. Profit after tax jumped 70 per cent YoY at Rs 114 crore.

Indo Count revised FY24 volume guidance to 90 - 100 million meters with margin guidance of 16 per cent-18 per cent.

Indo Count is among the top three Global bed sheet suppliers in the US. The product basket includes bed sheets, fashion bedding, utility bedding & institution bedding. Going forward the company is focused on expanding in value added segments such as fashion bedding, utility bedding and institutional bedding.

Indo Count in its investor presentation said, China Plus One’ has led to several western countries looking at alternate markets. The Government of India executed free trade agreements (FTAs) with Australia and UAE.  UK, Canada, EU and GCC FTA’s are in process. FTAs with these countries will open up market for Indian home textile exports and provide level playing field, the company said.

The government’s initiatives such as Atmanirbhar Bharat, production-linked incentive (PLI) schemes, textile parks are helping Indian textile players. The government of India has released a draft on second round of PLI (PLI 2.0) scheme for the textile sector. The scheme will attract investment and reduce the import dependence in textile accessories.