Textile stock jumps up to 8.50% after it announces closure of buyback

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Textile stock jumps up to 8.50% after it announces closure of buyback
Credit: © Reuters.

Shares of Welspun India Limited are currently trading at Rs 98.90. The scrip witnessed an intra-day high of Rs 104.60, indicating a gain of about 8.50 percent as compared to the previous closing price of Rs 96.45. The company has a market capitalization of Rs 9,771 crores.

Such movements in the stock prices are observed after the company, through a filing with the exchange, announced the closure of the buyback of 1,62,50,000 equity shares of Face Value of Rs 1 each at a price of Rs 120 per share aggregating to Rs 195 crores. The company extinguished the above-mentioned shares.

Welspun India Limited is a company based in India that is engaged in the process of making and selling home textiles. It’s product portfolio consists of bath robes, towels, carpets, etc. The company owns several brands including welhome, christy, spaces, and others.

The company has a wide distribution network with the United Kingdom, the United States, and Europe being the major markets.

Having a glance at the financials reported by the company, the operating revenues showed some improvement taking a shift from Rs 1,869 crores during Q3FY22-23 to Rs 2,154 crores in Q4FY22-23. Moreover, the company’s net profits, keeping the horizon the same, increased almost 193 percent taking a shift from Rs 44 crores to Rs 129 crores.

The profitability metrics, due to cost pressures, have taken a hit with the return on equity (ROE) reducing from 15.13 percent during FY21-22 to 4.86 percent in FY22-23 and the return on capital employed (ROCE), during the same period, moved from 17.03 percent to 7.21 percent.

The debt-to-equity ratio of the company, on a positive note, has been favourable showing a reduction from 0.80 times during FY21-22 to 0.57 times in FY22-23.

According to the latest shareholding data available for the March 2023 quarter, Promoters have a ‘skin in the game’ with 70.36 percent holdings, and Foreign Institutional Investors (FIIs) hold a 5.8 percent stake in the company.

Written by Amit Madnani

The post Textile stock jumps up to 8.50% after it announces closure of buyback appeared first on Trade Brains.

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