About the Company:
The company is one of the world’s leading manufacturers in the home textile industry, offering a comprehensive range of products, including bed and bath linen, rugs, and flooring solutions. It operates a vertically integrated supply chain with state-of-the-art manufacturing facilities in multiple locations. The company has a strong global distribution network, supplying products to over 50 countries, with a significant presence in the USA and Europe, which together account for the majority of its revenue.
The company is focused on expanding its brand and license portfolio, with a growing share of revenue coming from branded products. Recent investments have been made in the flooring segment, with no further capital expenditures planned in the near term. The company is also committed to sustainability, investing in renewable energy to reduce operational costs and environmental impact.
Our investment interpretation :
We identified this company as a market leader in India’s home textile industry, backed by a large and mature group that provides significant scale advantages. Our analysis highlighted its strong competitive positioning, which leverages India’s inherent advantages, such as access to raw materials, efficient design capabilities, and the ability to scale rapidly. This foundation has allowed the company to dominate its sector both domestically and globally.
At the time of investment, we recognized it as an exceptional value opportunity, with the company trading at just 4x-5x EV/ EBITDA, signalling substantial upside potential. Furthermore, our focus on its backward integration strategy revealed a clear path to cost leadership, providing the company with a strong foundation for sustainable profitability. We gained confidence in the company’s operational execution and future trajectory by re-evaluating our thesis from time to time. This approach, combined with our long-term investment view, positioned us to capitalize on the company’s growth and value creation.
Returns:
MCap on date of Investment: INR 551 Crs.
MCap on date of Exit/ Today: INR 18,309 Crs.
Multiple on Invested Capital (MOIC): 33x
