Sri Ramakrishna Mills (Coimbatore) Ltd (521178)
🎯 Key Takeaways
- Sri Ramakrishna Mills (Coimbatore) Ltd is a small-cap textile manufacturer with a strong profitability profile and elevated leverage, currently trading at a low P/E of 8.7 and high ROE of 47.
- Revenue grew 60.6% QoQ to ₹12 in Q2FY22.
- ⚠️ High leverage (D/E of 3.45) with no meaningful reduction despite asset stability, creating vulnerability to interest rate or cash flow shocks.
📖 The Story
Sri Ramakrishna Mills (Coimbatore) Ltd is a small-cap textile manufacturer with a strong profitability profile and elevated leverage, currently trading at a low P/E of 8.7 and high ROE of 47.2%. The company exhibits cyclical volatility in revenue and profitability, with recent quarters showing mixed operational performance. Despite stable promoter holding, institutional ownership remains negligible, suggesting limited market interest or perceived risk. The business appears to be in a fragile recovery phase, with profitability improving from deep losses but still vulnerable to input cost pressures and demand fluctuations.
📰 What's Happening
In Q3FY26 (September 2021), the company reported revenue of ₹12 crore and operating profit of ₹4 crore (OPM 33.8%), marking a significant improvement from the prior quarter’s ₹8 crore revenue and ₹0 operating profit. This rebound followed a period of near-zero profitability in June 2021, suggesting seasonal or demand-driven recovery. Management has not announced major new capex or strategic shifts recently, but consistent promoter stake retention (64.01% over multiple quarters) signals confidence in long-term stability. No M&A or restructuring activity was disclosed in the latest filings.
Source: Stock Announcements
📊 Quarterly Results (₹ Cr)
| Metric | Dec 2020 | Mar 2021 | Jun 2021 | Sep 2021 |
|---|---|---|---|---|
| Revenue | 6 | 10 | 8 | 12 |
| Operating Profit | 2 | 3 | 0 | 4 |
| OPM % | 38.3% | 28.4% | 1.9% | 33.8% |
| Net Profit | 2 | 1 | -0 | 3 |
| EPS | ₹2.35 | ₹0.70 | ₹-0.47 | ₹3.71 |
The company’s financial trajectory shows sharp volatility, with operating margins expanding from 1.9% in June 2021 to 33.8% in September 2021, driven by cost optimization or favorable input pricing. However, this came after a period of losses, indicating recovery rather than sustained growth. Revenue remains highly erratic, fluctuating between ₹6–12 crore over the past four quarters, suggesting exposure to cyclical demand in the textile sector. Profitability improvements are not yet translating into consistent top-line growth, raising questions about the durability of margins.
🔮 Management Outlook & What's Next
Management has not provided forward guidance or strategic outlook in the latest available filings. There is no explicit commentary on future revenue targets, margin expectations, or demand outlook in the Q3FY26 results or subsequent disclosures. The absence of guidance suggests either limited visibility or a conservative approach to forecasting, which may reflect the inherently volatile nature of the textile industry and the company’s exposure to raw material and order variability.
Extracted from official company announcements. Not StockFin.ai's opinion.
🏦 Balance Sheet (₹ Cr)
| Item | Mar 2020 | Mar 2021 | Mar 2021 | Mar 2022 |
|---|---|---|---|---|
| Equity Capital | 7 | 7 | 7 | 7 |
| Reserves | 2 | 0 | 2 | 5 |
| Borrowings | 35 | 36 | 33 | 32 |
| Total Liabilities | 59 | 58 | 59 | 58 |
| Fixed Assets | 5 | 5 | 5 | 5 |
| Investments | 0 | 0 | 0 | 0 |
| Total Assets | 59 | 58 | 59 | 58 |
The balance sheet shows a significant increase in borrowings to ₹32 crore as of March 2022, up from ₹33 crore in March 2021 (slight decrease in absolute terms but stable relative to asset base). Total assets remained flat at ₹58 crore, while equity and reserves grew modestly from ₹7 + ₹0 to ₹7 + ₹5 crore. This indicates that the company is relying on debt to fund operations or working capital needs, despite stable asset levels. The high D/E ratio of 3.45 suggests limited financial flexibility and elevated leverage risk, especially if operating performance weakens again.
💰 Cash Flow Statement (₹ Cr)
| Item | Mar 2021 |
|---|---|
| Operating | +6 |
| Investing | +0 |
| Financing | -6 |
| Net Cash Flow | -0 |
👥 Shareholding Pattern
| Category | Q2FY26 | Q3FY26 | Q4FY26 | Q1FY27 |
|---|---|---|---|---|
| Promoters | 64.0% | 64.0% | 64.0% | 64.0% |
| FII | 0.0% | 0.0% | 0.0% | 0.0% |
| DII | 0.0% | 0.0% | 0.0% | 0.0% |
| Public | 31.9% | 32.0% | 32.2% | 32.2% |
| # Shareholders | 4,143 | 4,081 | 4,075 | 4,082 |
Promoter holding remains stable at 64.01% over the last five quarters, with no signs of dilution or stake sale. Institutional ownership (FII/DII) is effectively zero, with no FII or DII holdings reported in Q1FY27. The public shareholding base is broad (32.17% with 4,082 shareholders), but low trading volume and lack of institutional interest suggest limited liquidity and analyst coverage. There are no indications of activist activity or significant shareholder engagement.
⚖️ Peer Comparison — Textiles
| Company | MCap (₹ Cr) | P/E | ROCE | ROE | D/E |
|---|---|---|---|---|---|
| GRASIM | 2.25 L Cr | 39.4 | 9.6% | 10.8% | 2.16 |
| WELSPUNLIV | 18,716 | 65.0 | 7.4% | 5.9% | 0.51 |
| VTL | 17,438 | 20.2 | 10.7% | 8.7% | 0.13 |
| ARVIND | 15,168 | 35.3 | 14.3% | 10.6% | 0.36 |
| TRIDENT | 12,302 | 30.9 | 10.1% | 8.3% | 0.37 |
| SWANCORP | 9,065 | 43.5 | 4.2% | 2.9% | 0.29 |
| ICIL | 8,583 | 56.9 | 9.8% | 6.4% | 0.46 |
| GARFIBRES | 8,169 | 39.4 | 22.9% | 16.9% | 0.05 |
| KUSUMGAR | 5,944 | — | — | — | 0.45 |
| PDSL | 5,105 | 43.4 | 12.5% | 10.5% | 0.64 |
🔗 Peer Stock Analyses
⚠️ Risk Factors
1. High leverage (D/E of 3.45) with no meaningful reduction despite asset stability, creating vulnerability to interest rate or cash flow shocks. 2. Highly volatile revenue and margins, as seen in the swing from ₹8 crore revenue and loss in Q2FY26 to ₹12 crore and strong OPM in Q3FY26, indicating lack of demand resilience. 3. Complete absence of institutional ownership may signal low investor confidence or perceived operational risk. 4. Raw material cost exposure in a sector with limited pricing power could pressure margins if input inflation resumes.
🧠 Analyst's Read
The company demonstrates intermittent profitability and balance sheet stability but lacks consistent growth momentum or institutional validation. Investors should monitor quarterly order inflows and raw material cost trends closely, as margins remain fragile despite recent improvements. The lack of guidance and zero institutional interest suggest the market may be pricing in structural challenges within the textile sector.
Based on filing content and financial data. Not a recommendation.
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Data sourced from stock announcements. Analysis generated by StockFin.ai.
For informational purposes only — not investment advice. Updated 2026-09-02.
Editorial & Data Transparency Notice
This analysis was programmatically compiled using StockFin AI utilizing official regulatory disclosures from the BSE and NSE. Content is automatically synthesized and audited against public financial filings. StockFin.ai is an educational research platform and is NOT a SEBI-registered investment advisor or research analyst.
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