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Sangam (India) Limited
NSE: SANGAMIND BSE: 514234 INE495C01010 Consumer Discretionary Consumer 🔎 Screen
₹2,789 Cr
Market Cap
23.4
P/E
0.31
PEG
10.7%
ROCE
8.7%
ROE
1.14
D/E
11.0%
OPM
-15.9%
% from 52W High
78
α RS
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📈 Price History
Ratio Health
Excellent
Good
Average
Poor
By Category
Shareholding
About

Sangam (India) Limited is engaged in the business of manufacturing and selling of Synthetic Blended, Cotton & Texturised yarn, Fabrics, Denim Fabrics and readymade seamless garment.

✓ Strengths 1
  • Company has been maintaining a healthy dividend payout of 24.9%
! Concerns 2
  • Stock is trading at 2.52 times its book value
  • Company has a low return on equity of 5.42% over last 3 years.
Key Ratios Snapshot
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📈 Growth Pattern
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Strong beat versus a very weak year-ago quarter — revenue grew 8.1% YoY, EBITDA margin expanded 418 bps to 12.9%, and PAT jumped from ₹2 Cr to ₹41 Cr. quarter Investor Presentation One-Pager? Jun 2026
Revenue
₹867 Cr
+8.1% YoY; -1.5% QoQ vs Q4 FY26 ₹880 Cr
EBITDA Margin
12.9%
+418 bps YoY; +180 bps QoQ; EBITDA ₹112 Cr (+59.6% YoY)
PAT
₹41 Cr
vs ₹2 Cr in Q1 FY26; PAT margin 4.7%; EPS ₹8.16
Key Metric
Gross Margin 43.6%
+640 bps YoY; capacity utilisation: denim 98%, PV fabric 97%
What Went Right
  • Revenue grew 8.1% YoY to ₹867 Cr and EBITDA grew 59.6% YoY to ₹112 Cr; EBITDA margin was 12.9% (+418 bps YoY).
  • Gross margin expanded 640 bps YoY to 43.6%, driving PAT from ₹2 Cr to ₹41 Cr on better realisations and product mix.
  • High capacity utilisation: denim fabric at 98% and PV fabric at 97% in Q1FY27, with denim production at 194 lakh metres.
  • FY26 working capital improved to a 55-day cash conversion cycle from 80 days in FY25; net debt/equity was held at 1.1x.
  • Renewable power plan is progressing: 36 MW operating, 40.7 MW under implementation, expected to save ₹48 Cr annually at full operation.
What to Watch
  • Sequential demand is not improving: Q1FY27 revenue of ₹867 Cr is 1.5% below Q4 FY26's ₹880 Cr, and yarn capacity utilisation fell to 85% from 95% in Q4.
  • Earnings are still low-margin and interest-heavy: PAT margin is only 4.7%, interest of ₹30 Cr consumed roughly 27% of EBITDA, and FY26 interest coverage was just 2.0x.
  • The ₹1,500 Cr capex bet on garmenting is unproven: current garment revenue is only 2% of mix, Q1FY27 garment utilisation was 50%, and no order book has been disclosed for the planned 10 lakh denim + 5 lakh PV garments per month.
  • Leverage/capex headroom is tightening: net debt/equity is 1.1x, FY27-FY32 debt repayments rise from ₹83 Cr to ₹173 Cr at peak, and the entire additional EBITDA target of ₹300 Cr depends on successful execution by March 2029.
Management Guidance
  • ~₹1,500 crore growth capex to be completed by March 2029, with phased commissioning from FY28.
  • ~₹300 crore annual EBITDA potential at full utilisation from the growth capex plan.
  • Renewable energy additions of 40.7 MW expected to generate ₹48 crore annual savings at full operation: ₹22 crore from solar and ₹26 crore from hybrid.
  • Garmenting capacity to be built: 10 lakh denim garments/month and 5 lakh PV garments/month.
  • Green fibre capacity to be expanded by 40 TPD, consuming ~50,000 MT of plastic waste annually at full capacity.
Investor Lens
The thesis is intact but still unproven: Q1FY27 was a sharp rebound from a depressed base (PAT ₹2 Cr in Q1FY26), not yet a durable demand breakout since revenue fell 1.5% QoQ and yarn utilisation dropped 10pp to 85%. The entire re-rating case now rests on the ₹1,500 Cr capex, especially garmenting, yet current garment revenue is just 2% of mix and utilisation is 50%, so the ~₹300 Cr additional EBITDA is aspirational until orders are contracted. Existing leverage also leaves little room for error: interest costs were ₹30 Cr in the quarter and net debt/equity is 1.1x, with debt repayments stepping up from FY28. Watch next quarter for yarn utilisation recovery, gross margin holding above 43%, any disclosed garmenting order book, and progress on the 40.7 MW renewable capacity.
From investor presentation · AI-generated analysis · Not investment advice
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📈 STRONG Net profit soars 875% YoY, OPM expands to 12%
Revenue
Revenue grew 7.6% YoY to ₹846 Cr, but declined 2.3% sequentially from ₹866 Cr. The YoY growth indicates steady demand, though the QoQ dip warrants attention.
Profitability
Net profit surged 875% YoY to ₹39 Cr, with EPS rising from ₹0.95 to ₹8.74. QoQ growth of 14.7% reinforces strong earnings momentum.
Margins
Operating profit margin improved sharply from 7% YoY and 11% QoQ to 12%, driven by better cost control or product mix. Operating profit rose 78.6% YoY.
Balance Sheet
Debt-to-equity ratio stands at 1.14, indicating moderate leverage. Interest expense of ₹29 Cr implies interest coverage of about 3.4x, which is adequate.
Key Risks
Debt-to-equity of 1.14 suggests elevated leverage. The sequential revenue decline could signal demand softness. Margin expansion may face sustainability if input costs rise.
Outlook
Focus on margin improvement is positive, but the sequential revenue dip needs monitoring. Sustained demand in consumer discretionary will be key for further growth.
Generated by AI · Jun 2026 results · Not investment advice
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