Dollar Industries ↗

The company over the years has broadened its product portfolio, which now spans innerwear products across wide price ranges, thermal wear, casual wear and athleisure wear. DIL has been able to establish itself in the highly competitive economy and mid-premium inner wear segment. The continuous addition of new products across segments through its established brands like Bigboss, Regular, Missy, ForceNXT, etc with focus on replenishing the design inventory regularly has aided DIL to

In 9MFY22, DIL reported increase in TOI by about 34% to Rs.977.31 crore over 9MFY21 driven by better off-take, improved sales mix and realisations. PBILDT and PAT margins also expanded to 16.51% and 11.13% respectively as compared with 14.68% and 9.22% respectively during 9MFY21. With the growth in sales, DIL’s working capital requirements have increased which has been funded through internal generations, higher creditors and through increase in working capital borrowings. Consequently, its outs

The company has aggressively pursued various marketing and promotional activities to improve its geographical reach and compete with existing players in the industry. DIL has a wide distribution network of over 1,000 dealers and over 1,00,000 retailers with pan-India presence. Further, the company is also exporting its products to 13 countries, though export sales only contributed to about 6% of sales in FY21. It has also planned to grow its online sales which would be helpful in the current

DIL has set up a factory for backward integration in the form of spinning and knitting mill near Tirupur (in Tamil Nadu) which caters for 30-35% of the company’s raw material requirements and h elps to mitigate the fluctuations in raw material prices and quality to a certain extent. The company owns 5MW of windmills in T amil Nadu, which caters to the power requirement of its spinning mill. DIL, in FY21, commissioned a solar power plant with a cap acity of 4MW in Tirupur for captive consumption.

Mr. Dindayal Gupta, ex-Chairman of the company has been in the textile industry since 1973. His son, Mr. Vinod Kumar Gupta, MD, with an experience of around three decades, is administering the financial and marketing strategies of the company. The promoters have also infused funds in the past to support its growing scale of operation and cater to the working capital requirements. Stable demand prospects The Indian innerwear industry is dominated by the unorganised segmen t which accounts for a l

The Indian innerwear industry is dominated by the unorganised segmen t which accounts for a large part of the overall market share. However, the market is gradually shifting towards organised retail/branded products. Going ahead, the outlook for the innerwear industry is expected to remain stable, albeit with gradual increase in market share of the organised segment of the industry.

The working capital cycle of DIL is high despite marginal improvement witnessed in FY21 wherein it improved to 224 days compared with 235 days in FY20. The same was primarily due to improvement in collection period which stood at 120 days in FY21 vis-à-vis 132 days in FY20. Inventory holding period is also high and stood at 156 days in FY21 vis-à-vis 159 days in FY20 as the company markets a wide range of products and accordingly has to maintain large quantity of inventory of each of its

Raw material cost, which forms around 50% of total cost, comprises mainly of cotton, yarn and fabric. Yarn and cotton being commodity in nature have volatile price movements and the profitability of the company remains exposed to such price movements. However, partially integrated nature of operations mitigates the risk to a certain extent. Intensely competitive industry The unorganised sector dominates the industry and there are few key players in the branded innerwear segment,including DIL.

The unorganised sector dominates the industry and there are few key players in the branded innerwear segment,including DIL. It remains exposed to significant competition from both the organised and the unorganised sector players for its various product segments due to which the company has exhibited moderate growth in its scale of operations in the past. However, with the unorganised sector more affected in terms of labour issues and stretch on liquidity and working capital due to the