Akshar Spintex Limited operates a state-of-the-art manufacturing facility in **Kalavad, Jamnagar District, Gujarat**. The location is strategically chosen within the **Shankar-6 cotton-rich belt**, providing the company with a competitive advantage through low-cost access to high-quality raw materials and proximity to **Kandla Port (250 km)** for efficient export logistics. | Feature | Technical Specifications | |:---|:---| | **Facility Size** | **2,20,000 square feet** | | **Installed Capacity** | **24,480 spindles** | | **Annual Production Capacity** | **7,500 MT** (Target) / **6,000 MT** (Base) | | **Technology Stack** | **German and Japanese** machinery; Compact spinning | | **Process Capabilities** | Contamination Controlled, Auto-coned, Carded, Semi-combed, and Combed | | **Count Range** | **16's to 44's Ne** | The facility is equipped with advanced automation, including **100% ring spindle monitoring**, link coners, and fully automatic contamination removal systems to maximize output and minimize wastage. --- ### **Product Portfolio & Value-Added Yarn (VAY) Transition** The company has strategically pivoted from commodity spinning to **Value-Added Yarns (VAY)** to protect operating margins and cater to the premium apparel and sustainable fashion segments. * **Core Products:** 100% Cotton Yarn in Carded, Semi-combed, and Combed varieties (**16's to 44's Ne**). * **Value-Added Variants:** Elitwist, Gassing, High twist, Melange, Slub Yarn, Core Spun Yarn, **TFO Yarn**, and Fancy Yarn. * **Specialized Processing:** Mercerized yarn and high-durability combed yarns for premium fabric segments. * **Sustainability Certifications:** To align with global brand requirements, the company produces **BCI (Better Cotton Initiative) Certified Yarn** and **Organic Yarn**. **VAY Performance Metrics:** * **FY 2023-24 Sales Volume:** **5,563.23 Tonnes** (representing **55% YoY growth**). * **Historical Growth:** VAY sales volume rose from **2,362 Tonnes** in FY22 to **2,650 Tonnes** in FY23, a **12%** increase following a prior **91%** surge. --- ### **Financial Performance & Capital Restructuring** Akshar Spintex demonstrated a financial turnaround in **FY24**, returning to profitability after a period of margin compression in FY23. **Comparative Financial Summary:** | Particulars (Rs. in Lakhs) | FY24 (Audited) | FY23 (Audited) | FY22 (Audited) | | :--- | :---: | :---: | :---: | | **Revenue from Operations** | **17,495.51** | **13,553.25** | **17,210.84** | | **Total Expenses** | **17,289.81** | **14,211.16** | **15,567.17** | | **Net Profit / (Loss)** | **349.19** | **(276.43)** | **702.36** | | **Earnings Per Share (Rs.)** | **0.12** | **(0.10)** | **0.28** | **Deleveraging & Solvency:** The company has significantly improved its balance sheet strength through aggressive capital raising and debt reduction. The **Net Debt to Equity ratio** improved from **0.43** to **0.07** year-on-year as of March 2025. | Capital Gearing (Rs. in Lakhs) | 31-Mar-25 | 31-Mar-24 | | :--- | :---: | :---: | | **Adjusted Net Debt** | **590.91** | **1,897.45** | | **Total Equity** | **8,821.15** | **4,388.34** | --- ### **Strategic Growth Drivers & Efficiency Initiatives** To mitigate the cyclicality of the textile industry, the company is executing a multi-pronged strategy focused on energy cost reduction and market expansion. * **Renewable Energy Transition:** * **Solar Rooftop System:** A **1000 KVA** installation (completed Nov 2023) generating annual savings of **Rs. 70 Lakhs to Rs. 1.20 Crore**. * **Solar Ground Mounted System:** A **7000 KVA** project in collaboration with Onix Renewable Limited (expected operational **Sept 2024**), projected to save **Rs. 8.00 to 9.00 crore** annually. * **Capital Market Actions:** * **Rights Issue (Oct 2024):** Raised **Rs. 48.75 Crore** (allotted **48,74,80,500** shares at **Re. 1**), increasing paid-up capital to **Rs. 78.75 Crore**. * **Stock Adjustments:** Executed a **1:10 stock split** (July 2023) and a **1:5 bonus issue** (Feb 2024) to enhance liquidity. * **Supply Chain & Export Strategy:** * Utilizes the **Advanced License Scheme** to import high-quality cotton duty-free, mitigating domestic price volatility. * Expanding footprint into **Africa** and **Latin America** to diversify beyond traditional markets. --- ### **Governance, Regulatory & Operational Risks** Despite operational growth, the company faces significant headwinds and internal control challenges that warrant investor attention. **Operational Vulnerabilities:** * **Order Volatility:** In **August 2024**, a major **Rs. 171.18 crore** international order from **Beximcorp Textiles (Bangladesh)** was cancelled due to regional political instability. * **Climate & Infrastructure:** Heavy rains in **August 2024** damaged the factory's **Air Duct** system, leading to a **two-week** shutdown. * **Commodity Risk:** Exposure to **11-year high** cotton prices and monsoon-dependent supply chains. **Governance & Compliance Issues:** * **Audit Qualifications:** Auditors issued a **disclaimer of opinion** in late 2025, citing the absence of a **fixed assets register** and lack of physical verification for inventories and assets. * **SEBI Penalties:** In **October 2024**, the company settled penalties regarding a **6.87%** undisclosed reduction in promoter shareholding. * **Managerial Remuneration:** Due to inadequate profits, the company is seeking shareholder approval for "minimum remuneration" for **Mr. Harry Paghdar (Executive Director)**, as payments exceeded **Section 197** limits. * **Internal Controls:** Historical discrepancies between bank filings and books of accounts for working capital limits, alongside delays in appointing an **Internal Auditor** for FY23. * **Legal & Regulatory:** A pending **NCLT** case regarding a **Rs. 2.40 crore** share transfer dispute and the ongoing financial impact assessment of the **New Labour Codes (effective Nov 2025)**. --- ### **Market Outlook & Future Positioning** Management anticipates that **Cotton-Yarn Spreads** will stabilize at pre-pandemic levels of **Rs. 85-90/kg**. With the migration from the BSE SME platform to the **NSE Main Board**, the company is positioning itself for higher institutional visibility. The primary focus remains on achieving **85%+ capacity utilization** and leveraging the new solar infrastructure to significantly lower the cost of production, thereby improving the net margin profile in a volatile global trade environment.