During Tuesday’s trading session, the shares of the largest global Home Textile bed linen manufacturer surged 3.4 percent to Rs. 414.55 on BSE, after the company acquired a majority stake of 81 percent in a US-based pillow and quilt maker.
With a market capitalisation of Rs. 8,063.8 crores, at 01:02 p.m., the shares of Indo Count Industries Limited were trading in the green at Rs. 407.15, up by nearly 1.5 percent, as against its previous closing price of Rs. 401.1.
Is Indo Count Industries a buy or sell? What is its Fair Value? What are the company's health parameters? What are the positive and negative factors driving the company -- ProTips? Know all the answers on the company's overview page here.
What’s the News:
According to the latest regulatory filings with the stock exchanges, Indo Count Global, Inc. (ICG), a wholly-owned US-based subsidiary of Indo Count, acquired Fluvitex USA, Inc., which is a part of Masias Invest, S.L., a renowned Spanish textile machinery firm since 1944.
ICG signed a definitive agreement for acquiring an 81 percent stake in Fluvitex USA, Inc., from its promoter shareholder – Masias Invest, S.L., with an exclusive option to purchase the remaining 19 percent stake within the next 5 years, specifically by September 30, 2029.
The cost of acquisition stood at $19.63 million as an initial purchase price representing the acquisition of an 81 percent stake in Fluvitex USA, Inc., funded through internal accruals and debt.
This acquisition marks a significant milestone in Indo Count’s development, serving as a key step towards establishing a manufacturing presence in the USA.
This expansion will enable the company to offer a diverse range of bedlinen products, including pillows, quilts, decorative pillows, and other fashion-oriented items to the large North American market.
The company’s Executive Vice Chairman remarked, “Acquiring Fluvitex is a critical move as it allows Indo Count to establish a fully integrated Utility Bedding business in the USA. Fluvitex’s state-of-the-art manufacturing facility and its strategic location will significantly enhance our ability to serve North American customers with a broader product range.”
About the Target Entity:
Fluvitex USA, Inc. is a Pillow & Quilt manufacturing company based in Columbus, Ohio, with an annual production capacity of 5 million pillows of different types and 1.5 million Quilts.
Fluvitex’s strategic location allows efficient distribution across the USA and Canada with a revenue potential of over $50 million.
Financials:
The company experienced significant growth in its revenue from operations, showing a year-on-year rise of around 27 percent from Rs. 741 crores in Q1 FY24 to Rs. 941 crores in Q1 FY25.
Similarly, its net profit increased marginally during the same period from Rs. 74 crores to Rs. 78 crores, indicating a rise of nearly 5.4 percent.
On a year-on-year basis, the Earnings Before Interest, Taxes, Depreciation, and Amortisation, or EBITDA increased from Rs. 130 crores in Q1 FY24 to Rs. 154 crores in Q1 FY25, registering a growth of 18 percent.
Stock Performance
The stock has delivered positive returns of nearly 66 percent of returns in one year, as well as around 26.6 percent returns in the last six months. So far in 2024, the shares of Indo Count Industries have given positive returns of about 35.5 percent.
About the Company:
Indo Count Industries Limited, the largest global home textile bed linen company, mainly deals in top-of-the-bed items in the textiles business and has a wide network of operations in local as well as overseas markets.
The company’s product portfolio in the premium segment comprises of bed sheets, fashion bedding, utility bedding and institutional bedding.
Written by Shivani Singh
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