East India Securitie's report on Nitin Spinners
Nitin Spinners Ltd (NSL) continued its stellar performance in Q4FY22. Sales at Rs7,691 mn - up 50.3% YoY & 9.1% QoQ, EBIDTA at Rs1,674 mn - up 60.7% YoY but down 6.0% QoQ, EBIDTA Margin 21.8% up 140bps but down 349bps QoQ PAT at Rs855mn - up 99.4% YoY but down 8.4% QoQ, The growth in the business led to near 100% capacity utilization of all products. Gross margins remain well supported, however declined QoQ due to lag in pass through of higher cotton prices. Nitin reported a cash profit of Rs1070 mn. Exports contributed ~73% of revenue for FY22 as the company was able to get higher margins.
We retain our Buy rating on the stock with a TP of Rs740 (10X FY24 EPS).
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