⚡ Flash Summary
Allawasaya Textile and Finishing Mills Limited (AWTX) reported a loss for the year ended June 30, 2025, a continuation of recent financial struggles. Revenue declined significantly compared to the previous year, although the loss was reduced. The company is seeking to improve performance by selling land to repay liabilities and improve working capital, as well as focusing on optimizing operations and cost efficiency. Future prospects are expected to remain challenging for the textile sector.
📌 Key Takeaways
- 📉 AWTX reports a loss of Rs (69.83) million for FY25, improved from a loss of Rs (249.77) million in FY24.
- 📉 Revenue from contracts decreased by 28.8% from Rs 6,118.25 million in FY24 to Rs 4,353.51 million in FY25.
- ✂️ Gross profit declined by 43.7% from Rs 273.04 million in FY24 to Rs 153.58 million in FY25.
- 🔥 Loss per share improved from Rs (312.21) in FY24 to Rs (87.29) in FY25.
- 🏭 Yarn production decreased from 16,183,418 Kgs in FY24 to 12,607,115 Kgs in FY25.
- 💰 The company proposes selling land to repay liabilities and improve working capital.
- ⚡ Solar Project commissioned and working to add one more Megawatt for cost reduction.
- ✅ Credit rating maintained at A2 for short term and BBB- for long term by PACRA.
- 🌐 The company holds ISO 9001:2015 and ISO 14001:2015 certifications.
- 📅 Annual General Meeting scheduled for October 27, 2025.
- 🗳️ Members can vote through postal ballot or e-voting for special business.
- 🏢 Independent Directors make up a sizable portion of the board.
- 👨💼 Board has formed Audit and HR committees.
- 🤝 Independent auditor’s review report is included.
- 👍 Auditors gave unqualified opinion on financial statements.
🎯 Investment Thesis
Given the company’s financial difficulties and the challenging outlook for the textile sector, HOLD is the recommendation. The company’s plan to sell land and reduce costs is a necessary step, but its success remains uncertain. Without a clear path to profitability and improved operational performance, the stock is not attractive for investment currently. Price movement reasoning is based on selling land, improving working capital, reducing the debt and better operational performance, the target is based upon the result. This will take MEDIUM_TERM to realize.
Disclaimer: AI-generated analysis. Not financial advice.