Arvind Mills gains in value and volume

Arvind Mills jumped 5.02% to Rs 55.45 on BSE on reports its 99% subsidiary Arvind Brands has signed a licensing agreement with Hartmarx Corp, a Chicago-based men's tailored clothing company.

Meanwhile, the BSE Sensex was down 272.39 points or 1.57% to 17,066.92 on negative cues from global markets. US markets suffered sharp losses on Wednesday, 7 May 2008, on worries about inflation and higher interest rates as oil jumped to a record.

On BSE, 43.26 shares were traded in the counter. The scrip had an average daily volume of 14.15 lakh shares in the past one quarter.

The stock hit a high of Rs 56.30 and a low of Rs 52.05 during the day. The stock had a 52-week high of Rs 93.50 on 31 December 2007 and a 52-week low of Rs 34.25 on 24 March 2008.

The small-cap scrip had outperformed the market over the past one month till 7 May 2008, advancing 34.52% compared to the Sensex's return of 11.24%. It also outperformed the market in the past one quarter, gaining 1.73% compared to Sensex's decline of 1.07%.

The company's current equity is Rs 209.38 crore. Face value per share is Rs 10.

The current price of Rs 55.45 discounts its Q3 December 2007 annualized EPS of Rs 1.08, by a PE multiple of 51.34.

As part of the agreement, Arvind Brands will design, distribute and retail three global brands- Hart Schaffner Marx and Sansabelt brands and, in co-operation with S.A.R.L. de Gestion Pierre Cardin, in India.

Reports further added that Arvind Mills plans to invest between Rs 10 crore to Rs 12 crore to set up 10 to 15 exclusive outlets for the three brands in 2009, initially focusing on Delhi, Mumbai and Bangalore.

A weak rupee which hovered near a one-year low of 41.71 against the dollar today, 8 May 2008, augurs well for Arvind Mills as it earns substantial revenue from exports.

Arvind Mills' net profit declined 94.6% to Rs 5.67 crore on 19.9% growth in net sales to Rs 536.84 crore in Q3 December 2007 over Q3 December 2006.

Arvind Mills is one of the leading textile manufacturers in the country. It owns various brands like Flying Machine, Newport and Ruf & Tuf jeans and Excalibur shirts. The company services the entire domestic market besides exporting to neighboring countries.