Nitin Spinners · Material risks, their source context, and severity in the latest available quarter.
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With zero import duty ended and 11% duty reinstated, domestic cotton trades at a premium to international prices. Management flagged that price parity with global markets is essential for competitive exports and better margins.
Knitting utilization is at only 40% due to US tariff disruptions. While management expects some recovery from the recent tariff reduction, they acknowledged past experience was negative and pledged cautious approach to avoid over-dependence.
Industry analyst raised concerns about India's flat/declining cotton productivity per acre versus globally improving yields, potentially threatening India's historical 15% cost advantage over US cotton. Management acknowledged efforts through industry associations but results expected in 1-2 years.
Management mentioned that drawback and other export benefits are not being given on duty-free cotton imports under advanced license, implying a 6-7% effective cost increase for export-oriented production.
