Ashnoor Textile Mills Faces Financial Challenges Amidst Modest Growth and High Debt Levels

Ashnoor Textile Mills, operating within the Garments & Apparels industry, has recently undergone an evaluation adjustment that reflects its current market standing. The company reported flat financial performance for the quarter ending June 2025, with net sales recorded at Rs 39.84 crore. Additionally, non-operating income constituted 36.08% of profit before tax, indicating a reliance on income sources outside of core operations.
Over the past five years, Ashnoor Textile has experienced a compound annual growth rate (CAGR) of 7.96% in net sales, which suggests modest growth in revenue generation. However, the company's ability to service its debt is a concern, highlighted by a debt to EBITDA ratio of 3.57 times. This metric points to potential challenges in managing financial obligations.

Despite these factors, Ashnoor Textile boasts a return on capital employed (ROCE) of 16.8, suggesting an attractive valuation with an enterprise value to capital employed ratio of 0.9. The stock is currently trading at a discount compared to the average historical valuations of its peers. Over the past year, the stock has generated a return of -3.03%, while profits have seen a notable increase of 66%, with a PEG ratio of 0.1.

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