Ambika Cotton

CMP:198.80


Ambika Cotton Mills Limited (ACML) based out of Coimbatore in Southern India, is engaged in the manufacture of premium quality Compact and Elitwist cotton yarn for hosiery and weaving. It is an established player in the international and domestic yarn market with exports constituting roughly sixty percent of its revenues.
The company was incorporated in 1988 and its 4 manufacturing units are situated in Dindigul, Tamil Nadu with a total spindle capacity of 110,000; of which 100,000 Spindles is of Compacting System.
Ambika Cotton Mills has the unique distinction of being the number one in the shirting segment and is the preferred client of all top quality shirt manufacturers around the world. It holds a very niche segment in the industry, thanks to its impeccable track record of product quality and delivery fulfillment. It also prides itself in its zero complaints with clients, shippers,and raw material suppliers.
ACML also takes its going-green commitment very seriously and produce over 110% of its power requirement by clean wind power. It also has a 100% governmental and legal compliance record.
Ambika holds the Supima certificate from Supima Association (USA), GOTS Certificate from Control Union (formerly SCAL) for organic yarn, and Oeko-Tex Certificate of Standard 100 Product Class I.


Financials:


Sales have moved up from 156cr to 390cr and NP from 13cr to 24cr during Mar 2008 to Mar 2012 registering EPS of 41for FY 2012.The companY's sales and NP for the first half year of 2012 are 193 cr and 14.39 cr respectively.Roce improved from 8% to 16% during the last 5 years while D/E ratio has came down considerably from 2.51 to 0.62.

The company paid a dividend of Rs.5 (50%) per share for the year 2012 on a Face Value of Rs.10/-.

The company may continue to do better and may be considered for buying at CMP of 198.