Orbit Exports Limited reported financial results for the quarter ended March 31, 2015. Net sales grew 15% to Rs. 424.77 million compared to the same quarter last year. Net profit jumped 139% to Rs. 63.26 million due to a 70% rise in EBITDA to Rs. 120.75 million. For the full fiscal year 2015, net sales increased 15% to Rs. 1574.05 million while net profit grew 27% to Rs. 266.99 million. The company expects net sales and profit to grow at a compound annual growth rate of 13% and 26% respectively from 2014 to 2017. Based on the financial projections, the report recommends buying the stock with a target price of Rs

1. CMP 394.70
Target Price 435.00
ISIN: INE231G01010
JUNE 24th
, 2015
ORBIT EXPORTS LIMITED
Result Update (PARENT BASIS): Q4 FY15
BUYBUYBUYBUY
Index Details
Stock Data
Sector Textiles
BSE Code 512626
Face Value 10.00
52wk. High / Low (Rs.) 483.80/128.25
Volume (2wk. Avg. Q.) 1218
Market Cap (Rs. in mn.) 5643.82
Annual Estimated Results (A*: Actual / E*: Estimated)
YEARS FY15A FY16E FY17E
Net Sales 1574.05 1762.94 1956.86
EBITDA 444.75 521.00 589.87
Net Profit 266.99 315.14 361.59
EPS 18.67 22.04 25.29
P/E 21.14 17.91 15.61
Shareholding Pattern (%)
1 Year Comparative Graph
ORBIT EXPORTS LIMITED BSE SENSEX
SYNOPSIS
Orbit Exports Limited was incorporated in 1983 and is
based in Mumbai, India. Engages in the manufacture
and export of novelty fabrics in India and exports its
products to south East Asian countries, the Middle
East, Europe, and North America.
Net sales of the company grew by 15.78% y-o-y to Rs.
424.77 million in 4th quarter of FY 2014-15 as against
Rs. 366.87 million in 4th quarter of the FY 2013-14.
In Q4 FY15, the company’s net profit Jumps to Rs.
63.26 million, an increase of 139% y-o-y from Rs.
26.47 million over the corresponding quarter of
previous year.
Operating profit stood at Rs. 120.75 million, rose by
69.90% in Q4 FY15 as against Rs. 71.07 million in the
corresponding quarter of previous year.
Profit before tax stood at Rs. 102.66 million in Q4 FY15
compared to Rs. 54.94 million in Q4 FY14, registered a
growth of 86.86% y-o-y.
The company has recommended the Final Dividend @
22.5% i.e., Rs.2.25/- per share on face value of
Rs.10.00/- each for the financial year 2014-15.
Net sales grew by 15% of Rs. 1574.05 million for the
end of FY15, as against Rs. 1370.15 million for the end
of FY14.
The Company has successfully installed and the
commercial production of the fabrics has started of the
14 new Jacquard Looms at Mangrol, Surat (Dist).
Net Sales and PAT of the company are expected to
grow at a CAGR of 13% and 26% over 2014 to 2017E
respectively.
PEER GROUPS CMP MARKET CAP EPS P/E (X) P/BV(X) DIVIDEND
Company Name (Rs.) Rs. in mn. (Rs.) Ratio Ratio (%)
ORBIT EXPORTS LTD 394.70 5643.82 18.67 21.14 6.04 45.00
LOYAL TEXTILE MILLS LTD 357.00 1719.50 31.14 11.46 1.22 75.00
ARVIND LTD 259.40 66988.30 14.62 17.74 2.45 25.50
RSWM LTD 260.00 6018.70 43.22 6.02 1.26 100.00

2. QUARTERLY HIGHLIGHTS (PARENT BASIS)
Results updates- Q4 FY15,
Orbit Exports Limited engages in the manufacture
and export of novelty fabrics in India and exports its
products to south East Asian countries, the Middle
East, Europe, and North America, The Company has
reported its financial results for the quarter ended
31st March, 2015.
The Company has achieved a turnover of Rs. 424.77 million for the 4th quarter of the financial year 2014-15 as
against Rs. 366.87 million in the corresponding quarter of the previous year. The company has reported an
EBITDA of Rs. 120.75 million an increased by 69.90% over the prior period of previous year. In Q4 FY15, net
profit is at Rs. 63.26 million against Rs. 26.47 million in Q4 FY14. The company has reported an EPS of Rs. 4.42
for the 4th quarter of financial year as against an EPS of Rs. 1.91 in the corresponding quarter of the previous
year.
Break up of Expenditure
During the quarter total expenditure rose by 4 per cent, mainly increased on account of Employee Benefits
Expenses by 107%, other expenditure by 22% Employee Benefits expenses by 53% are the main attribute for the
growth of expenditure when compared with corresponding quarter of previous year. Total expenditure in
Q4FY15 stood to Rs. 321.57 million as against Rs. 309.10 million in Q4 FY14.
Rs. In millions Mar-15 Mar-14 % Change
Net Sales 424.77 366.87 15.78
PAT 63.26 26.47 139
EPS 4.42 1.91 131.47
EBITDA 120.75 71.07 69.90
Break up of Expenditure
(Rs. in millions)
Q4 FY15 Q4 FY14
Cost of Materials Consumed 200.75 261.88
Depreciation & Amortization
Expenses
16.25 10.64
Employee Benefits expenses 28.61 13.85
Other Expenditure 77.94 63.66

3. COMPANY PROFILE
Orbit Exports Limited was incorporated in 1983 and is based in Mumbai, India. The company operates across
multiple verticals, from women’s apparel to Christmas crafts and home decor, with further interests in occasion
specific fabrics and finished products. In as much, the company’s products have always been, and continue to be,
entirely original, with respect to creativity and production. This is largely due to the presence of a dedicated in-
house design team that is continuously working to uphold the company’s long standing reputation for quality.
Orbit Exports Limited engages in the manufacture and export of novelty fabrics in India. It offers a range of fancy
fabrics, including metallics, faux silks, jacquards, made ups, and apparel for use in Christmas Craft, ladies dress
material, home textiles, fashion garments, and bridal wear.
The Company is a Government recognized Export House engaged and exports its products to south East Asian
countries, the Middle East, Europe, and North America. It also owns and operates a 0.60 MW capacity turbine
generator located in the state of Rajasthan.
Date of commencement of commercial production
The Company commenced commercial production at Jalgaon in Maharashtra in the year 1986 and set up a
manufacturing plant at Surat which was commenced on 29th September, 2010 and the Company had made
further expansion at Surat by installing new machineries in the year 2011-12.
Over the last six years, the company has undergone major restructuring in its business model, launched new
products, reorganized its finances and entered new markets. As a result, it has attained a major financial
turnaround, from a loss making venture into a profit making one. The Company’s customer base, which reflects
marquee high-end designer wear companies from across the globe, is now set to include the rapidly growing
Indian fashion apparel sector.

4. FINANCIAL HIGHLIGHT (PARENT BASIS) (A*- Actual, E* -Estimations & Rs. In Millions)
Balance Sheet as at March31, 2014-2017E
FY14A FY15A FY16E FY17E
I. EQUITY AND LIABILITIES:
A) Shareholders’ Funds:
a) Share Capital 138.49 142.99 142.99 142.99
b) Money received against Share Warrants 8.62 0.00 0.00 0.00
c) Reserves and Surplus 561.40 792.06 1053.44 1327.33
Sub-Total Net worth 708.51 935.05 1196.43 1470.32
B) Non-Current Liabilities:
a) Long-term borrowings 218.42 208.84 195.47 185.70
b) Deferred Tax Liabilities [Net] 56.91 72.71 89.43 105.53
c) Long Term Provisions 3.90 3.55 3.83 4.03
Sub-Total Long term liabilities 279.23 285.10 288.74 295.26
C) Current Liabilities:
a) Short-term borrowings 228.07 213.79 196.69 177.02
b) Trade Payables 32.78 23.94 17.96 13.83
c) Other Current Liabilities 61.23 42.88 30.87 22.85
d) Short Term Provisions 34.69 53.42 58.76 63.46
Sub-Total Current Liabilities 356.77 334.03 304.28 277.15
TOTAL EQUITY AND LIABILITIES (A + B + C) 1344.51 1554.18 1789.45 2042.73
II. ASSETS:
D) Non-Current Assets:
a) Fixed Assets 695.95 784.06 881.28 978.22
b) Non Current Investments 15.00 46.21 79.48 127.17
c) Long Term Loans and Advances 3.31 6.51 9.44 13.03
Sub-Total Non-Current Assets 714.26 836.78 970.20 1118.42
E) Current Assets:
a) Inventories 218.00 235.35 251.82 266.93
b) Trade Receivables 278.27 304.00 335.11 361.91
c) Cash and Bank Balances 51.65 67.51 86.41 108.62
d) Short Term Loans and Advances 79.67 106.88 141.08 180.58
e) Other Current Assets 2.66 3.66 4.83 6.27
Sub-Total Current Assets 630.25 717.40 819.25 924.31
TOTAL ASSETS (D + E) 1344.51 1554.18 1789.45 2042.73

5. Annual Profit & Loss Statement for the period of 2014 to 2017E
Value(Rs.in.mn) FY14A FY15A FY16E FY17E
Description 12m 12m 12m 12m
Net Sales 1370.15 1574.05 1762.94 1956.86
Other Income 4.65 5.66 6.23 6.72
Total Income 1374.80 1579.71 1769.16 1963.58
Expenditure -1053.36 -1134.96 -1248.16 -1373.71
Operating Profit 321.44 444.75 521.00 589.87
Interest -15.72 -12.74 -12.10 -13.31
Gross profit 305.72 432.01 508.90 576.55
Depreciation -34.94 -47.75 -54.91 -61.50
Exceptional Items 17.76 -0.29 1.42 3.72
Profit Before Tax 288.54 383.97 455.41 518.78
Tax -88.47 -116.98 -140.27 -157.19
Profit After Tax 200.07 266.99 315.14 361.59
Extraordinary Items -0.02 0.00 0.00 0.00
Net Profit 200.05 266.99 315.14 361.59
Equity capital 138.49 142.99 142.99 142.99
Reserves 561.40 792.06 1053.44 1327.33
Face value 10.00 10.00 10.00 10.00
EPS 14.45 18.67 22.04 25.29
Quarterly Profit & Loss Statement for the period of 30 Sept, 2014 to 30 June, 2015E
Value(Rs.in.mn) 30-Sep-14 31-Dec-14 31-Mar-15 30-Jun-15E
Description 3m 3m 3m 3m
Net sales 447.32 321.33 424.77 437.51
Other income 1.66 1.61 1.30 1.24
Total Income 448.98 322.94 426.07 438.75
Expenditure -317.98 -223.47 -305.32 -308.45
Operating profit 131.00 99.47 120.75 130.30
Interest -3.31 -3.03 -2.79 -2.62
Gross profit 127.69 96.44 117.96 127.68
Depreciation -11.00 -11.00 -16.25 -13.65
Exceptional Items 0.33 -3.95 0.95 1.41
Profit Before Tax 117.02 81.49 102.66 115.43
Tax -32.80 -25.00 -39.68 -30.24
Profit After Tax 84.22 56.49 62.98 85.19
Extraordinary Items -0.04 0.00 0.28 0.00
Net Profit 84.18 56.49 63.26 85.19
Equity capital 142.99 142.99 142.99 142.99
Face value 10.00 10.00 10.00 10.00
EPS 5.89 3.95 4.42 5.96

6. Ratio Analysis
Particulars FY14A FY15A FY16E FY17E
EPS (Rs.) 14.45 18.67 22.04 25.29
EBITDA Margin (%) 23.46% 28.26% 29.55% 30.14%
PBT Margin (%) 21.06% 24.39% 25.83% 26.51%
PAT Margin (%) 14.60% 16.96% 17.88% 18.48%
P/E Ratio (x) 27.32 21.14 17.91 15.61
ROE (%) 28.59% 28.55% 26.34% 24.59%
ROCE (%) 31.09% 36.28% 36.25% 35.53%
Debt Equity Ratio 0.64 0.45 0.33 0.25
EV/EBITDA (x) 18.23 13.49 11.42 10.00
Book Value (Rs.) 50.54 65.39 83.67 102.83
P/BV 7.81 6.04 4.72 3.84
Charts

7. OUTLOOK AND CONCLUSION
At the current market price of Rs. 394.70, the stock P/E ratio is at 17.91 x FY16E and 15.61 x FY17E
respectively.
Earning per share (EPS) of the company for the earnings for FY16E and FY17E is seen at Rs. 22.04 and Rs.
25.29 respectively.
Net Sales and PAT of the company are expected to grow at a CAGR of 13% and 26% over 2014 to 2017E
respectively.
On the basis of EV/EBITDA, the stock trades at 11.42 x for FY16E and 10.00 x for FY17E.
Price to Book Value of the stock is expected to be at 4.72 x and 3.84 x respectively for FY16E and FY17E.
We expect that the company surplus scenario is likely to continue for the next three years, will keep its
growth story in the coming quarters also. We recommend ‘BUY’ in this particular scrip with a target price of
Rs.435.00 for Medium to Long term investment.

8. INDUSTRY OVERVIEW
India’s textiles sector is one of the mainstays of the national economy. It is also one of the largest contributing
sectors of India’s exports contributing 11 per cent to the country’s total exports basket. The textiles industry is
labour intensive and is one of the largest employers. The industry realised export earnings worth US$ 41.57
billion in 2013-14.
The textile industry has two broad segments, namely handloom, handicrafts, sericulture, power looms in the
unorganised sector and spinning, apparel, garmenting, made ups in the organised sector.
The Indian textiles industry is extremely varied, with a hand-spun and handwoven sector at one end of the
spectrum, and the capital intensive sophisticated mill sector at the other. The decentralised power looms/
hosiery and knitting sector form the largest and knitting sector form the largest section of the Textiles Sector.
The close linkage of the Industry to agriculture and the ancient culture, the traditions of the country make the
Indian textiles sector unique in comparison to the textiles industry of other countries. This also provides the
industry with the capacity to produce a variety of products suitable to the different market segments, both within
and outside the country.
Market Size
The Indian textiles industry, currently estimated at around US $108 billion, is expected to reach US $ 141 billion
by 2021. The industry is the second largest employer after agriculture, providing direct employment to over 45
million and 60 million people indirectly. The Indian Textile Industry contributes approximately 5 per cent to
GDP, and 14 per cent to overall Index of Industrial Production (IIP).
The Indian textile industry has the potential to grow five-fold over the next ten years to touch US$ 500 billion
mark on the back of growing demand for polyester fabric. The US$ 500 billion market figure consists of domestic
sales of US$ 315 billion and exports of US$ 185 billion. The current industry size comprises domestic market of
US$ 68 billion and exports of US$ 40 billion.
Apparel exports from India have registered a growth of 17.6 per cent in the period April—September 2014 over
the same period in the previous financial year.
Investments
The textiles sector has witnessed a spurt in investment during the last five years. The industry (including dyed
and printed) attracted foreign direct investment (FDI) worth US$ 1,522.51 million during April 2000 to
December 2014.
Some of the major investments in the Indian textiles industry are as follows:

9. • Reliance Industries Ltd (RIL) plans to enter into a joint venture (JV) with China-based Shandong Ruyi Science
and Technology Group Co. The JV will leverage RIL's existing textile business and distribution network in
India and Ruyi's state-of-the-art technology and its global reach.
• Giving Indian sarees a ‘green’ touch, Dupont has joined hands with RIL and Vipul Sarees for use of its
renewable fibre product Sorona to make an ‘environment-friendly’ version of this ethnic ladieswear.
• Raymond has launched ‘Regio Italia’, a luxurious, elite and finest Italian fabric for its customers. Regio Italia is
a fine collection of fabrics from Italy with the latest designs that is carefully woven and specially handpicked
assortment of the best designs in formal and occasion menswear suiting fabrics.
• Snapdeal has partnered with India Post to jointly work on bringing thousands of weavers and artisans from
Varanasi through its website. “This is an endeavour by Snapdeal and India Post to empower local artisans,
small and medium entrepreneurs to sustain their livelihood by providing a platform to popularise their
indigenous products,” reported by CEO and Co-Founder, Snapdeal.
• Welspun India Ltd (WIL), part of the Welspun Group has unveiled its new spinning facility at Anjar, Gujarat -
the largest under one roof in India. The expansion project reflects the ethos of the Government of Gujarat’s
recent ‘Farm-Factory-Fabric-Fashion-Foreign’ Textile Policy, which is aimed at strengthening the entire
textile value-chain.
Government Initiatives
The Indian government has come up with a number of export promotion policies for the textiles sector. It has
also allowed 100 per cent FDI in the Indian textiles sector under the automatic route.
Some of initiatives taken by the government to further promote the industry are as under:
Duty free entitlement to garment exporters for import of trimmings, embellishments and other specified
items increased from 3 per cent to 5 per cent. This initiative is expected to generate an additional RMG
exports estimated at Rs 100000.00 mn (US$ 1.61 billion).
The government has also proposed to extend 24/7 customs clearance facility at 13 airports and 14 sea ports
resulting in faster clearance of import and export cargo.
The proposal for imposing duty on branded items was dropped providing relief to the entire value chain.
The Ministry of Textiles has approved a 'Scheme for promoting usage of geotechnical textiles in North East
Region (NER)' in order to capitalise on the benefits of geotechnical textiles. The scheme has been approved
with a financial outlay of Rs 4270.00 mn (US$ 69.12 million) for five years from 2014-15.

10. The Ministry of Textiles, Government of India plans to enter into an agreement with Flipkart to provide an
online platform to handloom weavers to sell their products.
The foundation stone of the Trade Facilitation Centre and Craft Museum was laid by Prime Minister of India
at Varanasi.
Detailed arrangement for purchase of cotton from the farmers by the Cotton Corporation of India Ltd (CCI)
under the Minimum Support Price Operation was monitored. 343 purchase centers were finalised in
consultation with the State Governments after meetings with officers of CCI and the cotton producing states,
resulting in streamlining of operations.
Road Ahead
The future for the Indian textile industry looks promising, buoyed by both strong domestic consumption as well
as export demand. With consumerism and disposable income on the rise, the retail sector has experienced a
rapid growth in the past decade with the entry of several international players like Marks & Spencer, Guess and
Next into the Indian market. The organised apparel segment is expected to grow at a compound annual growth
rate (CAGR) of more than 13 per cent over a 10-year period.
Disclaimer:
This document is prepared by our research analysts and it does not constitute an offer or solicitation for the
purchase or sale of any financial instrument or as an official confirmation of any transaction. The information
contained herein is from publicly available data or other sources believed to be reliable but we do not represent that
it is accurate or complete and it should not be relied on as such. Firstcall Research or any of its affiliates shall not be
in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the
information contained in this report. Firstcall Research and/ or its affiliates and/or employees will not be liable for
the recipients’ investment decision based on this document.

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