Multibagger Alert: This apparel firm has given returns of 113% in the past year!
Despite raw material led headwinds, the company is attempting to gain market share through premiumization initiatives and continued aggressive expansion of its retail network.
Hosiery and knitwear maker, Dollar Industries has given investors stellar returns of 113.66% over the last year. The share price of the company stood at Rs 257.65 on February 15, 2021, and since then, it has more than doubled investor wealth.
Headquartered in Kolkata, Dollar Industries engages in the manufacturing of hosiery and garments. The firm offers its products through the following brands: Bigboss; Club, Myme; Force Go Wear; Force Denims; Missy; Ultra Thermals; Champion Kids; Kids Care; Footprints; and Winter care.
In Q3, the company reported a 22.5% YoY growth in revenue to Rs 382.05 crore on an 11% volume growth in the quarter. The gross margin declined 400 bps YoY to 51.1% impacted by rising cotton prices which in turn impacted yarn prices. The headwind in the gross margin was partially offset by a price hike taken in December 2021. During the quarter, PBIDT (Ex OI) growth was 48.97% YoY to Rs 64.31 crore and the corresponding margins increased 300 bps to 16.8%. PAT grew 56.5% YoY to Rs 44.4 crore during the quarter. Among key developments during the quarter was Dollar’s agreement with a large private sector bank for channel financing to reduce receivables.
Despite raw material led headwinds, the company is attempting to gain market share through premiumization initiatives and continued aggressive expansion of its retail network. Through project Lakshay, the company now has 151 distributors on board, up from 90 in Q2 and 51 at the beginning of FY22. The company is able to deliver volume growth aided by the success of its cost-saving initiative Lakshay and its channel financing programme, and these factors have contributed to the rise in stock price over the past year.
At 3.30 pm on Wednesday, the stock of Dollar Industries Ltd was trading at Rs 550.20, down marginally by 0.05% or Rs 0.30 per share on BSE. The 52-week high of the scrip is recorded at Rs 665.70 and the 52-week low at Rs 225.90 on the BSE.
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