Refunds of VAT and GST will benefit denim fabric maker Nandan Denim by Rs 20 crores annually. This subsidy benefit is likely to be recognised by the company from Q2. Nandan Denim reported a profit of Rs 5.23 crores for the three months ended June compared to Rs 16.31 crores in the same period a year ago. Net sales were Rs 359.62 crores during the three months ended June compared to sales of Rs 424.44 crores a year ago.
Power subsidy will be around Rs 4 crores to Rs 5 crores on an annual basis. And GST will be around 2.5 per cent of the sales made in Gujarat. Nandan Denim is India’s largest denim fabric manufacturer. From a year-on-year perspective, Nandan has completed capacity expansions at the denim fabric, shirting fabric, and yarn manufacturing units.
The company’s fabric manufacturing capacity is 110 million meters per annum. Going forward, emphasis will be laid on fashion denim fabrics to target better realizations compared to regular denim material. A combination of higher sales volumes and value added products is likely to fuel top-line growth in the coming fiscals. Denim fabric contributes 80 to 90 per cent to Nandan’s annual turnover.
