We hereby enclose a copy of Unaudited Financial Results to be published in Trinity Mirror and Makkal kural for the quarter ended 30/06/2025.
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Sri Nachammai Cotton Mills, a Salem-based yarn manufacturer, reported Q1 FY26 standalone total income from operations of Rs. 1,400.51 lakhs, down from Rs. 1,727.16 lakhs in Q1 FY25. The company swung to a net profit of Rs. 538.13 lakhs versus a loss of Rs. 95.48 lakhs a year ago, with EPS at Rs. 12.56 vs a negative Rs. 2.24. However, this turnaround is heavily boosted by a one-time non-cash exceptional gain of Rs. 6.59 crores from the modification of preference share redemption terms (extension by 7 years to April 2032). On the operational side, the company cited weak yarn demand and unfavourable cotton-to-yarn price spread, forcing it to run only one unit in three shifts. On the positive side, power and fuel costs fell to Rs. 214.35 lakhs from Rs. 218.57 lakhs YoY, aided by solar power self-consumption, and an additional 2MW solar plant has been installed.
The headline profit looks strong but is largely an accounting one-off, not a sign of operational recovery — revenue is still falling and only one unit is operational due to weak demand, so real underlying earnings remain weak. Shareholders should treat the Rs. 538 lakh profit cautiously; sustainable improvement depends on yarn demand and cotton price parity returning.