Nitin Spinners Limited’s share (NSE: NITINSPIN) has surged sharply. Brokerage firms have been very enthusiastic about the company after the positive results of the first quarter ending June 30, 2024.
Analysts think that the share of the company can reach Rs 530 due to the strong financial performance of the company and the increase in margins.
Nitin Spinners reported a net income of Rs 42,1 crore for the quarter ending June. This is 47.5% more than last year’s same quarter.
Revenue for the company in the first three months of the current fiscal year is Rs 803 crores, which is 30.1% higher than last year’s same quarter.
EBITDA is Rs 118,8 crores for the quarter. This is 56.1% higher than last year’s same quarter.
EBITDA has increased 246 basis points (bps) between April and June 2024. It is now 14.8%.
The gross margin of the company increased from 2.52 percent to 37.2 percent, and its cash profit for the quarter was Rs 7.8 crore.
Exports accounted for 64 percent of the company’s revenue in the first three months.
Stocks With BUY Ratings
A top brokerage firm stated in its report that Nitin Spinners maintained its good performance despite the low demand.
Recent capacity expansions have led to an increase in sales, EBITDA, and PAT.
The brokerage firm, which has a BUY rating, said that “Margins are improving as cotton prices continue to fall, but profitability remains below normal levels.”
The report stated that “all new capacity, except for knitwear, is almost fully utilized.”
They believe that QoQ results should improve further from here, with cotton prices at current levels and expectations of further improvement in the demand.
The brokerage firm set a target price for the stock of Rs 532, which represents a 23 percent increase.
Gains Of Over 1,100% In Just Four Years
Nitin Spinner’s share hit a 52-week high on Thursday of Rs 447.05. The total market value of Nitin Spinners now stands at Rs 2,500 crore.
In the previous session, the stock closed at Rs 432.10. In the last two months, the stock has gained almost 25 percent.
The share of Nitin Spinners rose over 1,100% in the past four years. Stocks have risen from Rs 37 to Rs 447 in July 2020.
The stock has almost doubled the wealth of investors from its low point in 52 weeks, Rs 225. Stocks have gained 35% in 2024.
A renowned brokerage firm stated that although the first quarter of the year was difficult, Nitin remains optimistic about the long-term growth prospects of the company.
The company’s sales volume will increase after the capacity expansion of knitting and weaving is completed.
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