Zenith Fibres Limited is a specialized Indian industrial player with nearly **three decades** of expertise in the manmade fibre industry. The company operates a dual-segment business model focused on the production of **Polypropylene Staple Fibre (PPSF)** and the generation of **Green Energy**. Headquartered in **Vadodara, Gujarat**, the company is distinguished by its **debt-free balance sheet**, high-quality manufacturing standards (**ISO 9001:2015**), and a strategic pivot toward niche international markets. --- ### **Core Manufacturing: Polypropylene Staple Fibre (PPSF) & P.P. Yarn** The company’s primary revenue driver is its manufacturing facility located at **Savli, Vadodara**. Zenith Fibres is a leading producer of **Polypropylene Staple Fibre (PPSF)**, a material valued for its chemical resistance and versatility. * **Product Applications:** * **Liquid Filtration:** PP fibre is considered **irreplaceable** for filter fabrics due to its unique chemical properties. * **Automotive & Flooring:** Extensively used in **automotive carpets** and **exhibition carpets**. * **Infrastructure:** Applied in **construction** and **geo-textiles**, though these segments face higher substitution risks from other synthetic fibres. * **Operational Excellence:** The company maintains a **"virtually nil" rejection rate**, adhering to stringent international benchmarks. This quality focus has fostered long-standing relationships with domestic and global conglomerates. * **Revenue Model:** Sales are conducted on standard credit terms of **30-60 days**, utilizing a variable consideration model for rebates and pricing incentives. #### **Fibre Division Performance Metrics** | Particulars | FY 2023-24 | FY 2022-23 | | :--- | :--- | :--- | | **Total Production (MT)** | **2,054.85** | **3,251.32** | | **Domestic Sales (MT)** | **1,094.71** | **813.41** | | **Export Sales (MT)** | **656.50** | **1,998.82** | | **Yarn Sales (MT)** | **333.38** | **358.36** | | **Segment Sales (Rs. in Lakhs)** | **3,426.15** | **5,010.92** | | **Profit After Tax (Rs. in Lakhs)** | **131.75** | **283.82** | --- ### **Energy Portfolio: Captive Power & Sustainability** Zenith Fibres integrates green energy to mitigate rising operational costs and enhance its ESG profile. * **Wind Power:** Operates a wind turbine at **Vejalpar, Morbi (Gujarat)**. * **FY 2023-24 Generation:** **25,13,176 KWH** (Revenue: **₹1.77 crore**). * **FY 2024-25 Generation:** **14,60,155 KWH** (Revenue: **₹1.42 crore**). * *Note:* Generation was impacted by a mechanical failure in **September 2024**, with full restoration achieved by **March 2025**. * **Solar Power:** In **October 2025**, the company commissioned a **300 KW (315 KW approved)** rooftop solar system at the Vadodara plant. * **Investment:** **₹1.25 crores** funded via internal accruals. * **Expected Output:** Approximately **4.32 lakh units** annually for captive consumption. * **Grid Integration:** Surplus power is sold to the grid via **Madhya Gujarat Vij Company Limited**. --- ### **Strategic Growth & Corporate Restructuring** Management is actively transitioning the company from a commodity-focused producer to a value-added specialist. * **Niche Market Pivot:** Strategic focus on developing **niche products** for international markets to secure higher margins and offset domestic competition from unorganized players. * **Asset Monetization:** The company is streamlining its balance sheet by divesting non-core assets. In **March 2025**, it sold **1,80,000 shares** of **Rainy Properties Pvt. Ltd.** for **₹27,00,000**. A further sale of **3,60,000 shares** for **₹54,00,000** is in progress, though partially delayed by buyer non-performance. * **Leadership Continuity:** Key personnel have been re-appointed for a **three-year term (2025–2028)**: * **Mr. Sanjeev Rungta:** Executive Chairman & CEO. * **Mr. Aman Rungta:** Whole Time Director Finance & CFO. * **Promoter Activity:** In **June 2025**, promoter **Pinky Rungta** increased her stake by **6.12% (2,41,600 shares)** via inter-se transfers. Concurrently, the company is reclassifying several former promoter entities into the **'Public'** category to modernize governance. --- ### **Financial Profile & Capital Structure** Zenith Fibres maintains a conservative financial stance, characterized by a **zero-debt** status and strong liquidity. | Metric (₹ in Crore) | FY 2024-25 | FY 2023-24 | FY 2022-23 | | :--- | :---: | :---: | :---: | | **Total Revenue from Operations** | **52.20** | **34.28** | - | | **Profit Before Tax (PBT)** | **2.40** | **1.73** | - | | **Profit After Tax (PAT)** | **1.80** | **1.32** | - | | **Cash and Cash Equivalents** | **18.61** | **15.02** | - | | **Total Equity** | **56.45** | **55.00** | **54.20** | | **Total Debt** | **0.00** | **0.00** | **0.00** | **Key Financial Highlights:** * **Revenue Growth:** Achieved a **52.26%** year-on-year increase in the most recent full fiscal year. * **Non-Recurring Income:** Recognized **₹2.52 crore** in **Liquidated Damages** in late 2025 due to cancelled sale contracts. * **Foreign Exchange:** Reported earnings of **₹13.66 crore** against an outgo of **₹3.93 crore** (as of August 2024). The company does not use derivatives, as current exposure is deemed manageable. --- ### **Risk Assessment & Mitigation** Investors should monitor several operational and external headwinds: * **Infrastructure Aging:** Manufacturing assets are over **30 years old**, leading to rising maintenance costs and structural repair requirements for the factory. * **Supply Chain & Commodities:** Exposure to **Polypropylene (PP) Resin** price volatility is mitigated through an **MOU with a designated vendor**. * **Market Pressures:** Intense competition from **Chinese suppliers** and domestic unorganized players continues to squeeze margins. High **freight cost volatility** remains a risk for the export segment. * **Legal & Insurance Contingencies:** * The company is contesting a **₹1.85 crore** rejected insurance claim related to the 2024 windmill failure. * Ongoing monitoring of an **Order-In-Original** from the **CGST and Central Excise Audit** (November 2025). * **Operational Pauses:** In **May 2023**, the plant was suspended for **2-3 weeks** to manage inventory levels amid a temporary order slowdown, highlighting the company's sensitivity to volume fluctuations. * **Labour Regulations:** Management is currently assessing the impact of the **New Labour Codes** (effective **November 2025**), though no material impact on provisioning is currently expected.