RSWM Limited — Investor Meet, 19-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** RSWM reported a revenue of ₹1,196 Cr, up 2.5% quarter-over-quarter and 22.3% year-over-year, with a nine-month revenue of ₹3,569 Cr, marking a 23.7% increase. EBITDA for Q3 was ₹58 Cr, up 36.3% from the previous quarter and 2.6 times higher than the same quarter last year. However, the company posted a reduced loss after tax of ₹8 Cr, improving from a loss of ₹21 Cr in the prior quarter and ₹32 Cr year-on-year.

**Future Outlook and Growth Drivers:** Management remains optimistic about burgeoning growth in the textile sector, particularly due to stable cotton prices and positive government initiatives aimed at enhancing textile manufacturing and exports. The company's strategy involves incorporating Industry 4.0 technologies for improved operational efficiency.

**Order Book and Operational Updates:** The acquisition of Ginni Filaments played a significant role in revenue generation, contributing positively, especially in the knitting segment. The company is focusing on improving capacity utilization across its divisions while managing the challenges posed by cotton price disparities.

**Analyst Q&A Insights:** Analysts inquired about the demand and pricing dynamics for mélange yarn, with management noting an improved trend but still facing competitive pricing challenges. Queries surrounding the sustainability of EBITDA growth highlighted effective cost management as a vital contributor. Concerns regarding finance costs led to discussions on the company's current debt of ₹1,600 Cr and future capital allocation strategies, reaffirming a focus on debt reduction rather than significant new investments.

**Market or Regulatory Updates:** The call addressed potential shifts in export opportunities due to geopolitical factors impacting Bangladesh. This presents RSWM with favorable circumstances to capture new market share.

**Strategic Focus Areas:** Management expressed a clear commitment to operational excellence and sustainability, leveraging technology to enhance productivity and lower costs.

**Investor Insight:** RSWM's improving financial health and growth trajectory, alongside management's emphasis on cost-effective operations and market adaptability, align with a 'buy' stance for retail investors, tempered by the recognition of ongoing challenges related to raw material costs and debt management.