Vijay Kishanlal Kedia Portfolio Stock Declares 150% Interim Dividend: Buy?

At Friday's closing session, Siyaram Silk Mills, a small-cap textile firm, had a market valuation of Rs 2,322.95 Cr. India's leading maker of fabrics is Siyaram's Silk Mills Ltd. Additionally, Siyaram's has dabbled in a new line of business: premium yarns are used to create textiles for home furnishings. The financial results for the quarter ending December 31, 2023, and an interim dividend of 150% for FY24 have been released by the corporation.

Siyaram Silk Mills Dividend

The Board of Directors "Considered and declared 2nd Interim Dividend of Rs.3/- (150%) per equity share on the Paid up Equity Shares of Rs. 2/- each, for the Financial Year 2023-24. The Interim Dividend will be credited/paid/ dispatched within 30 days from the date of declaration as per applicable provisions of Companies Act, 2013, to such shareholders as on Record Date i.e. 19th February, 2024," said Siyaram Silk Mills in a stock exchange filing.

Siyaram Silk Mills Financials

According to the firm, its revenue from operations in Q3 FY24 was Rs 502 crores, down from Rs 501 crores in Q3 FY23. EBITDA decreased 9.7% YoY to Rs 69 crores in Q3FY24 from Rs 76 crores in Q3FY23. In Q3FY24, the EBITDA margin was 13.6%, compared to 15.1% in Q3FY23. PAT plummeted 14.9% YoY to Rs 44 crores in Q3FY24 from Rs 52 crores in Q3FY23. In Q3FY24, the PAT margin was 8.8% as opposed to 10.4% in Q3FY23.

Mr. Gaurav Poddar, Executive Director, Siyaram Silk Mills Limited said: "Despite facing subdued consumer demand and challenging market conditions, our company has showcased resilient performance. In terms of financial performance, our Revenue from Operations for Q3FY24 stood at Rs. 5,019 Mn, a slight increase from Rs. 5,011 Mn in Q3FY23. Our revenue mix comprised Fabric at 85%, Garments at 10%, and Yarn & Others at 5% in Q3FY24. We are pleased to report an EBITDA of Rs. 685 Mn with an EBITDA Margin of 13.6% for the quarter. Furthermore, our Profit After Tax (PAT) for the quarter amounted to Rs. 443 Mn, with a PAT Margin of 8.8%."

"Additionally, we have expanded our retail footprint to a total of 239 stores as of December 31, 2023, demonstrating our commitment to growth and market presence. In accordance with our strategic decision made at the beginning of the fiscal year, our investment in advertising and sales promotion remains elevated, aimed at bolstering brand presence and stimulating sales growth," he added.

"While the current quarter's profitability has been temporarily affected by these factors, our financial foundation remains strong. We are delighted to announce that the board of directors has approved a dividend of Rs. 3/- (150%) per share, based on the face value of Rs. 2/- each. Notably, in the past quarter, we have strategically increased our advertising and sales promotion spend to Rs. 17.5 crores, compared to Rs. 7.8 crores in the corresponding quarter of the previous year, to enhance brand visibility and drive sales momentum. With a sound balance sheet and disciplined capital management, we are well-equipped for the next phase of growth. We also would like to extend our gratitude to stakeholders for their continued trust and support," he further stated.

Siyaram Silk Mills Share Price Target

Mandar Bhojane - Equity Research Analyst at Choice Broking said SIYSIL, currently trading at 512 levels, is exhibiting a sideways trading pattern within the range of 486 -575 for the past 8 months. This consolidation suggests a period of indecision or equilibrium in the market.

The lower end of this range, around 496, serves as a strong support level in weekly time frame and aligns with the 100-Day Exponential Moving Average (EMA). This confluence enhances the significance of this support level, indicating a potential bounce when the price approaches it.

There's a minor resistance observed near the upper end of the range, around 570 levels. A successful breach of this resistance may pave the way for an upward movement towards the next resistance at 635 - 650 levels. This presents a potential opportunity for traders.

Currently, SIYSIL is trading above its long term (200 Day) and Medium term (100 Day) EMA levels, signalling strength in its trend. The momentum indicator RSI is at 42.5 levels, indicating a neutral position. This suggests a balanced market sentiment without a clear bias towards overbought or oversold conditions.

The observed support levels, contribute to a positive and promising outlook for SIYSIL in the dynamic landscape of technical analysis.

Vijay Kishanlal Kedia Shareholding

As per the data available on BSE for the quarter ended 31st December 2023, ace investor Vijay Kishanlal Kedia held 5,05,000 shares of the company in his portfolio representing 1.11% of the issued and paid-up share capital of Siyaram Silk Mills.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.