Operating Leverage Inflection
Expected: CurrentMEDIUM confidence
What: Interest Cost: ₹2.54 Cr
Impact: 25% reduction QoQ
Ambika Cotton Mills Ltd: Why Is It Outperforming Nifty 500?
ActiveRS +23.7%Weak5w Streak
In , Ambika Cotton Mills Ltd (Textiles - Spinning) is outperforming Nifty 500 with +23.7% relative strength. Fundamentals: Weak. On a 5-week streak.
Ambika Cotton Mills Ltd Key Facts
- PE Ratio
- 14.8x
- Market Cap
- ₹928 Cr
- PAT Growth YoY
- +7%
- Revenue Growth YoY
- +12%
- OPM
- 14.0%
- RS vs Nifty 500
- +23.7%
PE: Near PeakWatch Value
What's Happening
📊PE near cycle highs — limited room for further expansion
💪Debt reduced 100% YoY — balance sheet strengthening
💰Trading 46% above estimated fair value — significant premium
Earnings Acceleration Triggers
1. Operating Leverage Inflection
CurrentMEDIUM
2. Tam Expansion Changing Consumption
FY26-FY31MEDIUM
Key Risks
1. Income Tax demand of ₹45
LOW2. Foreign currency fluctuation loss impacted Q3 earnings
MEDIUM3. Iran-Israel war impact is moderately negative for the sector
MEDIUMSector-Specific Signals
Total Spindle Capacity114,336 units+6,048
Export Revenue Share60%
Book Value Per Share₹1,579.14
Interest Coverage9.85x
Key Numbers
PAT Growth YoY
+7%
Stable
Revenue YoY
+12%
Inflection Up
Operating Margin
14.0%
0 bps YoY
PE Ratio
14.8
Current Price
₹1,621
Dividend Yield
2.28%
Fundamental Score
38/100
Weak
3Y PAT CAGR
-28%
Market Cap
928 Cr
Valuation
Significantly Overvalued12-Week Performance
Weekly presence in the outperformers list. Green = beating Nifty 500 by 10%+ that week.
12 weeks agoThis week
Why Are Ambika Cotton Mills Ltd's Earnings Accelerating?
Based on Q3 FY26 (web) earnings • Updated Apr 18, 2026
Tam Expansion Changing Consumption
Expected: FY26-FY31MEDIUM confidence
What: Cotton Mission: 5-year plan
What Are the Key Risks for Ambika Cotton Mills Ltd?
Earnings deceleration risks from management commentary
Income Tax demand of ₹45
LOWTrigger: Income Tax demand of ₹45.24 lakh for AY 2024-25 due to disallowed expenses.
Impact: PAT impact: ₹0.45 Cr
Management view: Company plans to appeal and states no material impact on operations.
Monitor: regulatory
Foreign currency fluctuation loss impacted Q3 earnings
MEDIUMTrigger: Foreign currency fluctuation loss impacted Q3 earnings.
Impact: PAT impact: ₹4.14 Cr
Monitor: fx
Iran-Israel war impact is moderately negative for the sector
MEDIUMTrigger: Iran-Israel war impact is moderately negative for the sector.
Monitor: geopolitical
What Did Ambika Cotton Mills Ltd Report This Quarter?
Headline numbers from the latest earnings call
Revenue
₹174.17 Cr
YoY +11.46%QoQ -12.76%
Revenue grew year-on-year but faced a significant sequential decline due to volume pressures and order timing.
EBITDA
₹25.02 Cr
YoY +11.44%Margin 14.37%
Operating margins remained stable year-on-year and improved sequentially despite the revenue drop.
PAT
₹15.17 Cr
YoY +6.23%QoQ -4.83%
Net profit growth was supported by lower interest costs and a write-back of expenditure.
Other Highlights
• Interest costs declined to ₹2.54 Cr from ₹3.39 Cr QoQ.
• Foreign currency fluctuation loss of ₹4.14 Cr recorded in Q3.
• Write-back of expenditure amounting to ₹6.23 Cr supported PAT.
What Sector Metrics Matter for Ambika Cotton Mills Ltd?
Sub-sector-specific signals from the latest concall — each with management's stated reason for the change
Total Spindle Capacity
114,336 units
YoY +6,048
Why: Capacity expanded by 6,048 spindles during the quarter.
Export Revenue Share
60%
Why: Not explained in source
Book Value Per Share
₹1,579.14
Why: Reflects years of retained earnings and conservative financial management.
Interest Coverage
9.85x
Why: Improved due to declining interest costs.
What Is Ambika Cotton Mills Ltd's Management Guidance?
Forward-looking targets from management for Q4 FY26
Revenue Growth Target
11.5%
OPM Guidance
10–14%
Capex Plan
₹57 Cr
Revenue Outlook
10-13% YoY increase
Margin Outlook
EBITDA to rise
Capex Plan
₹57 Cr
Capacity expansion to 120,816 spindles
Volume
Capacity expansion
Management Tone: CAUTIOUS
How Fast Is Ambika Cotton Mills Ltd Growing?
Revenue, profit and margin growth rates
| Metric | YoY | 3Y CAGR | Trend |
|---|---|---|---|
| Revenue | +12% | -9% | Inflection Up |
| PAT (Net Profit) | +7% | -28% | Stable |
| OPM | 14.0% | 0 bps | Stable |
The above analysis is parsed from publicly available earnings call transcripts. This is educational research only — not investment advice. Last updated Apr 18, 2026.
Other Top Textiles - Spinning Stocks Beating Nifty 500
Frequently Asked Questions: Ambika Cotton Mills Ltd
Based on publicly available financial data. This is educational research, not investment advice.
What were Ambika Cotton Mills Ltd's latest quarterly results?
Ambika Cotton Mills Ltd's latest quarterly results (Dec 2025) show
- PAT Growth YoY: +7.1% (stable)
- Revenue Growth YoY: +11.5%
- Operating Margin: 14.0% (stable)
Is Ambika Cotton Mills Ltd's profit growing or declining?
Ambika Cotton Mills Ltd's profit is growing with an stable trend.
- PAT Growth YoY: +7.1% (latest quarter)
- PAT Growth QoQ: -6.2% (sequential)
- 3-Year PAT CAGR: -28.4%
- Trend: Stable — consistent growth pattern
What is Ambika Cotton Mills Ltd's revenue growth trend?
Ambika Cotton Mills Ltd's revenue growth trend is turning around (inflection up).
- Revenue Growth YoY: +11.5%
- Revenue Growth QoQ: -13.0% (sequential)
- 3-Year Revenue CAGR: -8.7%
How is Ambika Cotton Mills Ltd's operating margin trending?
Ambika Cotton Mills Ltd's operating margin is stable.
- Current OPM: 14.0%
- OPM Change YoY: 0.0% basis points
- OPM Change QoQ: +1.0% basis points
What is Ambika Cotton Mills Ltd's 3-year profit and revenue CAGR?
Ambika Cotton Mills Ltd's long-term compounding rates
- 3-Year Profit CAGR: -28.4%
- 3-Year Revenue CAGR: -8.7%
Is Ambika Cotton Mills Ltd's growth accelerating or decelerating?
Ambika Cotton Mills Ltd's earnings growth is stable with mixed signals on a sequential basis.
- YoY Acceleration: -7.2% bps
- Sequential Acceleration: -6.2% bps
What is Ambika Cotton Mills Ltd's trailing twelve month (TTM) performance?
Ambika Cotton Mills Ltd's trailing twelve month (TTM) performance
- TTM PAT: ₹63 Cr
- TTM PAT Growth: -4.5% YoY
- TTM Revenue: ₹702 Cr
- TTM Revenue Growth: -8.9% YoY
- TTM Operating Margin: 14.3%
Is Ambika Cotton Mills Ltd overvalued or undervalued?
Ambika Cotton Mills Ltd appears significantly overvalued based on our fair value analysis.
- Valuation Signal: Significantly Overvalued
- Current PE: 14.8x
- Price-to-Book: 1.0x
What is Ambika Cotton Mills Ltd's current PE ratio?
Ambika Cotton Mills Ltd's current PE ratio is 14.8x.
- Current PE: 14.8x
- Market Cap: 928 Cr
- Dividend Yield: 2.28%
How does Ambika Cotton Mills Ltd's valuation compare to its history?
Ambika Cotton Mills Ltd's current PE is 14.8x.
- Current PE: 14.8x
- Valuation Assessment: Significantly Overvalued
What is Ambika Cotton Mills Ltd's price-to-book ratio?
Ambika Cotton Mills Ltd's price-to-book ratio is 1.0x.
- Price-to-Book (P/B): 1.0x
- Book Value per Share: ₹1635
- Current Price: ₹1621
Is Ambika Cotton Mills Ltd a fundamentally strong company?
Ambika Cotton Mills Ltd is rated Weak with a fundamental score of 37.56/100. This score is calculated from objective financial metrics
- Revenue Growth YoY: +11.5% (10% weight)
- PAT Growth YoY: +7.1% (10% weight)
- PAT Growth QoQ: -6.2% (10% weight)
- Margins stable (10% weight)
Is Ambika Cotton Mills Ltd debt free?
Ambika Cotton Mills Ltd has a debt-to-equity ratio of N/A.
- Total Debt: ₹51 Cr
What is Ambika Cotton Mills Ltd's return on equity (ROE) and ROCE?
Ambika Cotton Mills Ltd's return ratios over recent years
- FY2023: ROCE 21.0%
- FY2024: ROCE 11.0%
- FY2025: ROCE 11.0%
Is Ambika Cotton Mills Ltd's cash flow positive?
Ambika Cotton Mills Ltd's operating cash flow is positive (FY2025).
- Cash from Operations (CFO): ₹129 Cr
- Free Cash Flow (FCF): ₹106 Cr
- CFO/PAT Ratio: 195% (strong cash conversion)
What is Ambika Cotton Mills Ltd's dividend yield?
Ambika Cotton Mills Ltd's current dividend yield is 2.28%.
- Dividend Yield: 2.28%
- Current Price: ₹1621
Who holds Ambika Cotton Mills Ltd shares — promoters, FII, DII?
Ambika Cotton Mills Ltd's shareholding pattern (Mar 2026)
- Promoters: 50.4%
- FII (Foreign): 0.3%
- DII (Domestic): 1.7%
- Public: 47.6%
Is promoter holding increasing or decreasing in Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd's promoter holding has remained stable recently.
- Current Promoter Holding: 50.4% (Mar 2026)
- Previous Quarter: 50.4% (Dec 2025)
- Change: 0.00% (stable)
How long has Ambika Cotton Mills Ltd been outperforming Nifty 500?
Ambika Cotton Mills Ltd has been outperforming Nifty 500 for 5 consecutive weeks, indicating building momentum.
Is Ambika Cotton Mills Ltd a new momentum entry or an established outperformer?
Ambika Cotton Mills Ltd is an established outperformer with 5 weeks of consecutive Nifty 500 outperformance.
What are the growth catalysts for Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd has 2 key growth catalysts identified from recent earnings analysis
- Operating Leverage Inflection — Lower debt servicing costs are directly boosting the bottom line despite topline pressure.
- Tam Expansion Changing Consumption — Government focus on cotton production could improve raw material security and long-term demand.
What are the key risks in Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd has 3 key risks worth monitoring
- [LOW] Income Tax demand of ₹45 — Income Tax demand of ₹45.24 lakh for AY 2024-25 due to disallowed expenses.
- [MEDIUM] Foreign currency fluctuation loss impacted Q3 earnings — Foreign currency fluctuation loss impacted Q3 earnings.
- [MEDIUM] Iran-Israel war impact is moderately negative for the sector — Iran-Israel war impact is moderately negative for the sector.
What is Ambika Cotton Mills Ltd's management guidance for growth?
Ambika Cotton Mills Ltd's management has provided the following forward guidance for Q4 FY26
- Revenue growth target: 11.5%
- OPM guidance: 10–14%
- Capex plan: ₹57 Cr for Capacity expansion to 120,816 spindles
- Management tone: cautious
What sector-specific metrics matter most for Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd's most important sub-sector-specific KPIs from the latest concall
- Total Spindle Capacity: 114,336 units (YoY +6,048) — Capacity expanded by 6,048 spindles during the quarter.
- Export Revenue Share: 60% — Not explained in source
- Book Value Per Share: ₹1,579.14 — Reflects years of retained earnings and conservative financial management.
- Interest Coverage: 9.85x — Improved due to declining interest costs.
Is Ambika Cotton Mills Ltd worth studying for long term investment?
Based on quantitative research signals, here is why Ambika Cotton Mills Ltd may be worth studying
- Earnings growing at +7.1% YoY
- Cash flow is positive — CFO ₹129 Cr
What is the investment thesis for Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd investment thesis summary:
Research Signals (Bull Case)
- Revenue growing at +11.5% YoY
- Growth catalyst: Operating Leverage Inflection
Risk Factors (Bear Case)
- Appears significantly overvalued
- Key risk: Income Tax demand of ₹45
What is the future outlook for Ambika Cotton Mills Ltd?
Ambika Cotton Mills Ltd's forward outlook based on current data signals
- Earnings Trend: stable
- Revenue Trend: turning around (inflection up)
- Margin Trend: stable
- Valuation: Significantly Overvalued
- Key Catalyst: Operating Leverage Inflection
- Key Risk: Income Tax demand of ₹45
The above FAQs are generated from publicly available earnings data and conference call transcripts. This is educational research only. Sector Alpha is not SEBI registered and does not provide investment advice.