Harish textile engineers limited
Introduction
Harish textile engineers limited is an Indian firm that is involved in the manufacture of textile processing machinery and technical textile products. The company deals with the textile engineering industry that provides machines that are used in the processing and finishing of fabric.
Industry Analysis
One of the largest industries in India is the textile industry which contributes approximately about 2.3 per cent of the GDP, 13 per cent of industrial production and 12 per cent of exports. The textile market in the world is projected to reach between 723- 859 billion between 2024 and 2028 at a CAGR of approximately 3-4. The Indian textile machinery sector is another sector which is enjoying modernization, automation, and government policies such as PLI (Production Linked Incentive) and MITRA parks.
The industry has however been affected by challenges like fluctuation in the prices of the raw materials, the global competition and the cyclic demand.
Purpose of the Analysis
This analysis is aimed at examining the financial performance and learning the business model of the company and analyzing its strengths, risks and future prospects as an investment perspective.
Company Overview
The history of operation of Harish Textile Engineers Limited is rich history in terms of manufacturing textile machinery. The company has positioned itself as a niche player in the textile engineering arena especially in processing machinery.
The business model is founded on producing and selling of textile machinery and equipment and also rendering services. Revenue is generated from:
Sale of machinery
After sales services and maintenance.
Spare parts and technical assistance.
Key products include:
Machines used in textile processing.
Finishing machines and coating.
Technical clothing machinery.
The firm has both the domestic and export markets where it serves textile manufacturers.
It is the small-to-mid-sized market player that deals with a niche. Although it is not in the competition with big world machinery manufacturers, it possesses the niche status because of its technical knowledge and tailor made solutions.
Promoters and its role
Promoters and management professionals of the company include experienced people on the technical and industry knowledge.
The promoters have a background in:
Textile engineering
Manufacturing operations
Business management
They have played a significant role in:
Establishing long term relationships with customers.
Sustaining quality and innovation of the product.
Pushing strategic moves like growth and cost management.
The management further contributes towards operational effectiveness and conforming to the changing trends of the industry.
Financial Statement
Profit and Loss
Particulars | Mar-23 | Mar-24 | Mar-25 |
Sales | 116.44 | 131.04 | 132.03 |
Gross Profit | 18.13 | 19.84 | 18.75 |
EBITDA | 7.58 | 6.90 | 5.87 |
Depreciation | 2.20 | 1.87 | 1.68 |
Interest | 5.28 | 5.51 | 4.03 |
Earnings Before Tax (EBT) | 0.10 | -0.48 | 0.16 |
Net Profit | -0.04 | -0.37 | 0.24 |
Balance Sheet
Particulars | Mar-23 | Mar-24 | Mar-25 |
Equity Share Capital | 3.34 | 3.34 | 3.34 |
Reserves | 6.20 | 5.36 | 5.55 |
Equity (Total) | 9.54 | 8.70 | 8.89 |
Borrowings | 39.98 | 36.12 | 31.68 |
Other Liabilities (CL) | 27.61 | 32.79 | 35.63 |
Total Liabilities | 77.13 | 77.61 | 76.20 |
Fixed Assets | 26.28 | 27.81 | 28.01 |
Current Assets | 37.53 | 38.62 | 39.90 |
Total Assets | 77.13 | 77.61 | 76.20 |
Cash Flow Statement
Particulars | Mar-23 | Mar-24 | Mar-25 |
Operating Cash Flow | 1843 | 973 | 2931 |
Investing Cash Flow | 433 | 915 | -1507 |
Financing Cash Flow | -2254 | -2244 | -1034 |
Net Cash Flow | 22 | -356 | 390 |
Ratio Analysis
Ratio | Mar-23 | Mar-24 | Mar-25 |
Net Profit Margin % | -0.03% | -0.28% | 0.18% |
Gross Profit Margin % | 15.57% | 15.14% | 14.20% |
Current Ratio | 1.36 | 1.18 | 1.12 |
Debt to Equity | 4.19 | 4.15 | 3.56 |
Asset Turnover | 1.51 | 1.69 | 1.73 |
The Major Findings and Analysis.
Strengths
The company has demonstrated stable revenues with recovery in the last few years (Mar-25).
There is stability in profitability where the net profit is growing to 1.21 Cr as compared to 1.10 Cr.
High liquidity position; current ratio of greater than 4, which is a good measure of short-term solvency.
An increase in reserves shows a positive net worth and financial stability.
Weaknesses
The profit margins are low (between 2 3 percent net margin)
The sales were volatile, particularly decreasing in Mar-24.
As a small player it has less pricing power.
It relied on cycles in textile industries.
Risk Factors
Cyclicality of demand of machinery in the industry.
Changes in raw material and input cost.
International and local rivalry.
Soaring interest rates and financial charges.
Future Outlook
The company has medium positive prospects in the future. As the demand towards automation and modernization of the textile industry continue to grow, the company has the opportunity to receive benefits in:
Replacement demand of the old machinery.
Technical textile growth.
Export opportunities
Nevertheless, continuous development will be based on:
Improving margins
Expanding market reach
Managing costs efficiently
Conclusion
Summing up, the growth profile of Harish Textile Engineers Limited is consistent but average. The financial management of the company has been sound as it has recorded consistent profitability and had a good liquidity status.
But low margins and erratic sales indicate that there is a problem with operations. The industry cycle of textile is highly connected to the performance of the company, and it is rather exposed to external factors.
Investment wise, the company can be discussed as a moderate-risk, moderate-return investment. It is appropriate to those investors who are interested in stability not high growth.