Pioneer Embroideries Ltd. (BSE: 514300, NSE: PIONEEREMB) is one of the largest manufacturer-exporter of Embroideries, Torchon/Bobbin laces, Raschel laces and other
garment accessories.
Earlier, the company reported strong earnings for the year ended 31 March 2024. During the financial year, both the businesses – Specialized Polyester Filament Yarn (SPFY) and Embroidery and Laces (EL) – grew almost equally, with the former contributing about 84% to the Company’s revenues. Both the businesses also witnessed rise in EBIDTA and margins, over previous year and PEL’s EBIDTA grew 72% from ₹ 153.1 mn to about ₹ 263.9 mn.
As the capacity expansion in both the businesses got completed during the year, FY23-24 saw a substantial rise in interest cost, from ₹ 36.4 mn to about ₹ 92.6 mn. Depreciation also increased by about 48% to about ₹ 125.4 mn during the year. Both these cost items limited the rise in Profit before Tax and Exceptional Items, which rose from₹ 32.1 mn to about ₹ 45.8 mn only.
Exports however, remained constrained for both SPFY and EL, owing to higher logistics costs related to Red Sea conflict, and overall inflationary trends in Europe and US affecting both demand and retail inventory levels for textiles in general. With its effective marketing network rising to the challenge, PEL did well in domestic market and non-traditional export geographies. The domestic sales for EL grew by 39% to about ₹ 506.5 mn and that of SPFY grew by 15% to about ₹ 2,389.4 mn.
For PEL, the performance in the second half was expectedly better, as its expanded capacities came into play. While turnover in H2 was higher by 15% over H1, despite macro headwinds, the EBIDTA margins were substantially higher at 9.1% as compared to 6.4% in H1.
Established in 1991 by Mr Raj Kumar Sekhani, Pioneer Embroideries Limited (“PEL”) is one of India’s notable manufacturers and exporter of value-added Specialized Polyester Filament Yarn and Embroidery & Laces. It has a state-of-the-art SPFY manufacturing facility at Himachal Pradesh and three Embroidery & Laces manufacturing facilities in Gujarat, Dadra & Nagar Haveli and Maharashtra.
Within a few years, PEL has carved a permanent niche for itself in the SPFY business worldwide, with best-in-class quality under the SILKOLITE brand. PEL has a yarn capacity of about 18,000 MT pa. The Company’s products find application mainly in the non-apparel segment, used in carpets, bath mats, upholstery fabrics, and curtains. PEL became one of the first textile companies to create a brand in a highly commoditized yarn business.
PEL’s products enjoy a premium in the marketplace because of better quality, design, and capacity. Owners of the heritage brand – Hakoba – PEL has added strength to the brand by building upon an extensive library of embroidery designs, making Hakoba synonymous with high-quality embroidery across the world. At present, the Company has three embroidery and lace manufacturing facilities at Naroli (UT DN&H), Sarigam (Gujarat) and Degaon (Maharashtra), along with a wide marketing presence at all the major markets.