Siyaram Silk Mills Ltd. share price target

Siyaram's brand portfolio consists of reputed brands like Siyaram (flagship brand), Oxemberg, MSD and J Hampstead Over the last decade, the company has gradually expanded its fabric and garment capacities and simultaneously managed to reduce the debt/equity from 1.0x in FY12 to 0.2x in FY21 Q3FY22 Results: SSML reported a strong revenue recovery with a significant...

Siyaram brand portfolio consists of reputed brands like Siyaram (flagship brand), Oxemberg, MSD and J Hampstead Over the last decade, the company has gradually expanded its fabric and garment capacities and simultaneously managed to reduce the debt/equity...

Siyaram's brand portfolio consists of reputed brands like Siyaram (flagship brand), Oxemberg, MSD and J Hampstead Over the last decade, the company has gradually expanded its fabric and garment capacities and simultaneously managed to reduce the debt/equity...

In FY21, Siyaram re-engineered its cost structure with significant rationalisation of overheads including marketing spends. Operating overheads declined 42% YoY in FY21. The management expects 25% of cost savings to be sustainable in nature, going forward. Gross margins (including processing charges) deteriorated by ~820 bps YoY to 35% mainly on account of higher liquidation discounts and schemes given to dealers and distributors. We expect gross margins to revert to normalised levels in FY22E. With a complete washout in Q1 (87% revenue decline), Siyaram...

The demand for fabrics is gradually inching towards normalisation levels and given Siyaram's strong brand patronage and distribution network (which mainly encompasses Tier II/III cities), it is well placed to capture market share opportunities in the segment. The garmenting division (15% of sales) on the other hand, is still not out of the woods as inventory in trade channels appears to be on the higher side. This led to lower flow of new orders from dealers/distributors. For YTDFY21, revenue declined 52% YoY to | 597 crore. The company has re-engineered its cost structure with...

Given the weak demand scenario for fabric and apparel categories in domestic markets and excess inventory in trade channels, Siyaram (SSML) reported revenue decline of 64.4% YoY to | 173.6 crore (up 3.2x QoQ). However, the recovery rate trajectory has been on an upward trend MoM. Green shoots are visible for the fabric division (~80% of revenues), wherein recovery rate in September reached 60-70% of pre-Covid levels. Garmenting segment continued to be a laggard with recovery rate reaching 30-40% in September. Gross margins (including processing charges)...

Tepid consumption demand across product categories and a challenging Q4FY20 led to overall topline de-growth of 6.4% YoY to | 1699.3 crore in FY20. On the segmental front, fabrics division (~74% of revenues) de-grew 4% YoY whereas garmenting segment (~20% of revenues) saw revenue degrowth of 14% YoY to | 350.0 crore. Higher competitive intensity and subsequent lower realisation weighed on the performance of garmenting segment. As on date, trading channels are stuck with excess inventory. Hence, primary sales are expected to pick up only when the cash cycle starts to improve. On the profitability front, price cuts and higher trade discounts...

Given the subdued market conditions, the working capital cycle may witness certain deterioration owing to higher inventory days. However, SSML continues to focus on stringent control on cash conversion cycles through better management of receivable days. Also, with no major capex plans in the near term, debt is expected to remain at levels similar to FY19 for the current fiscal. We roll over our estimates to FY22E and build in revenue and earnings CAGR of 4.2%, 10.4% YoY, respectively, in FY19-22E. We expect revenue growth to remain under pressure owing to challenging market...

Uptick in festive season to be critical for Siyaram The management highlighted that market conditions remained sluggish post implementation of GST while normalisations at the dealer's level took longer than anticipated. Despite higher number of wedding days in Q1FY20, revenue growth continued to remain muted. Upcoming festive season and stabilisation of trade channels remain critical triggers for green shoots in revenues. Furthermore, the company may have to increase its marketing spends to revive sales growth leading to pressure on operating margins. We...

FY19 was a challenging year for the company with moderate topline growth of 4.8% YoY to | 1816.2 crore. The management highlighted that market conditions remained sluggish post implementation of GST while normalisations at dealer's level took longer than anticipated. To address this issue, the management had to invest in marketing spends and trim its average realisations especially for garmenting segment. This translated into 90 bps margin contraction to 13.2% YoY in FY19. With stabilisation of trade channels and higher number of wedding dates in FY20, we expect revenue...

ICICI Securities Ltd | Retail Equity Research SSML reported decent revenue growth of 13.4% YoY to | 446.3 crore despite market conditions remaining subdued. The fabric division grew 13% YoY to | 332 crore while growth in the garmenting segment grew marginally by 1.4% YoY to | 87 crore. Revenues from the yarn segment grew 3.4x to | 16 crore mainly due to commencement of production of its dyed yarn (indigo) facility Gross margins for the quarter contracted significantly by 265 bps...

Key financials *EPS adjusted post stock split Revenues for the quarter grew at a moderate pace of 8.5% YoY to | 458.7 crore. Fabric and garmenting division grew 5% each YoY to | 298 crore and | 132 crore, respectively. Revenues from the yarn segment grew 4x to | 18 crore mainly owing to commencement of...

For 2QFY2019, Siyaram Silk Mills (SSML) posted subdued set of results, which were below our expectations on both, top-line as well as bottom-line fronts. Revenue grew ~9% yoy. On the margin front, the company reported operating margin contraction by 173bps yoy. On the bottom-line front, SSML reported de-growth of ~11% yoy to ~`27cr due to..

For 1QFY2019, Siyaram Silk Mills (SSML) posted subdued set of results, which were below our expectations on both, top-line as well as bottom-line fronts. Revenue was flat yoy, however, the company reported operating margin improvement. On the bottom-line front, SSML reported de-growth of ~4% yoy to ~`10cr due to subdued top-line growth. O..

Better gross margins (up 50 bps YoY) and lower other expense as a percentage of sales (down 75 bps YoY) led to EBITDA margin improvement of 20 bps YoY to 10.5%. However, higher employee & processing charges as a percentage of sales (up 62 bps, 40 bps, respectively) stemmed the margin expansion. Subsequently, absolute EBITDA grew 2.7% YoY to | 34 crore Though other income rose 84% YoY to | 7.7 crore, higher interest cost (up 77% to | 11 crore) and increase in depreciation (up 4% YoY...

EBITDA margins for the quarter improved significantly by 270 bps YoY to 16.4% (highest ever EBITDA margins), mainly on account of positive operating leverage (processing charges and other expense down 40 bps and 252 bps YoY, respectively). Subsequently, absolute EBITDA increased 35.0% YoY | 98 crore Higher depreciation (up 32% YoY to | 15.5 crore) and interest cost (up 153% YoY to | 12.2 crore), coupled with one-time exceptional...

For 4QFY2018, Siyaram Silk Mills (SSM) posted good set of results, exceeding our expectations on both, top-line as well as bottom-line fronts. Revenues grew by ~12% yoy. On the operating front, the company reported operating margin improvement. On the bottom-line front, SSM reported growth of ~19% yoy to `52cr on the back of strong top-li..