Arvind Limited: history, ownership, mission, how it works & makes money

A Brief History of Arvind Limited

Arvind Limited, established in 1931, has grown from a textile manufacturer into a diversified conglomerate. The company is headquartered in Ahmedabad, India, and primarily operates in the textile, apparel, and engineering sectors. Over the years, Arvind has expanded its operations and product offerings, making it one of the largest textile companies in India.

In the initial decades, Arvind focused on producing cotton and denim fabrics. The company was one of the pioneers in the Indian textile industry, introducing advanced weaving technology. By the 1980s, Arvind had established itself as a key player in the denim market, producing over 110 million meters of denim annually.

In 1991, Arvind Limited ventured into branded garments and formed collaborations with international brands. This strategic move allowed the company to tap into the growing demand for branded apparel in India. By 2000, Arvind's brand portfolio included prominent labels like Arrow, US Polo Assn., and Tommy Hilfiger.

Arvind Limited went public in 1994 and has consistently delivered strong financial performance. As of the fiscal year ending March 2023, the company's revenue stood at approximately ₹8,000 crores (about $1.06 billion), a significant increase from ₹6,500 crores in the previous year.

The company has also embraced sustainable practices, launching initiatives aimed at reducing water usage and carbon emissions in its manufacturing processes. In 2022, Arvind announced a goal of achieving 30% reduction in water consumption by 2025.

In recent years, Arvind has diversified further into various sectors, including technical textiles and advanced materials. With a robust export market, the company exported textiles worth approximately ₹1,200 crores in the fiscal year 2023, reinforcing its global presence.

As of October 2023, Arvind Limited's stock is trading at approximately ₹140 per share, reflecting a market capitalization of around ₹4,000 crores ($535 million). This represents a year-to-date increase of about 25%.

Arvind has consistently focused on innovation, launching several new product lines, including sustainable and organic fabrics, which are gaining traction in both domestic and international markets.

The company has a strong balance sheet, with assets totaling approximately ₹7,500 crores, and a debt-to-equity ratio of 0.5, showcasing its financial stability. Moreover, Arvind Limited remains committed to enhancing its operational efficiency and expanding its market footprint through strategic partnerships and acquisitions.

A Who Owns Arvind Limited

Arvind Limited, a prominent player in the textile and apparel manufacturing sector, has a diverse ownership structure comprising individual and institutional shareholders. As of the latest reports, the holding pattern of Arvind Limited illustrates a blend of promoters, institutional investors, and public shareholders.

The largest stakeholders in Arvind Limited include the founder family and their affiliates, who have maintained a significant shareholding over the decades. The company is led by the Lalbhai family, notably expressed through the direct and indirect shareholdings of key members.

As of the most recent financial year ending March 2023, the company's total outstanding shares were approximately 185 million. The share price displayed notable fluctuations, reaching a high of around ₹115 per share and a low of ₹76 during the year.

In terms of financial performance, Arvind Limited reported a revenue of ₹7,785 crore for the fiscal year 2023, reflecting a growth of approximately 12% year-on-year. The net profit for the same period was reported at ₹225 crore, with a profit margin of approximately 2.89%.

Arvind has been actively pursuing strategic partnerships and collaborations, particularly in sustainable fabrics, which aligns with global trends toward eco-friendly production. This strategic focus has attracted interest from institutional investors, driving their ownership stake in the company.

The company has also been listed on the Bombay Stock Exchange (BSE) under the ticker symbol ARVIND, where it has maintained a strong market presence. The average trading volume for the stock over the past year was approximately 1.2 million shares per day, indicating robust investor interest.

Arvind Limited Mission Statement

Arvind Limited, established in 1931, has positioned itself as a leader in the textile sector, focusing on innovation, sustainability, and customer satisfaction. The company's mission statement highlights its commitment to deliver superior quality products while fostering sustainable practices throughout its operations.

The mission statement emphasizes the following core elements:

• Innovation in product development and operational processes.
• Commitment to sustainability and environmental responsibility.
• Focus on high customer service standards and satisfaction.
• Empowerment of employees through skill development and engagement.

As of the latest financial year ending March 31, 2023, Arvind Limited reported consolidated revenues of ₹7,144 crores, reflecting a growth of 10% compared to the previous fiscal year. Their EBITDA margin stood at 14%, indicative of robust operational efficiency.

In terms of geographical presence, Arvind Limited has expanded its footprint internationally, exporting to over 100 countries. Its commitment to sustainable practices is highlighted by its investment in renewable energy, with plans to achieve 100% renewable energy utilization by 2025.

Additionally, the mission statement aligns with the company’s objective to encourage transparency and ethical practices in the entire supply chain. Arvind Limited has been recognized for its responsible sourcing and adherence to social compliance standards, further solidifying its position as a brand that values integrity.

The use of advanced technologies in production has also been a focal point, with investments amounting to ₹600 crores for technology upgrades and digitization in the last fiscal year. This is expected to enhance productivity and strengthen supply chain resilience.

Furthermore, with an extensive portfolio that includes textiles, apparel, and advanced materials, Arvind Limited aims to continuously evolve and adapt to the changing market dynamics, ensuring long-term growth and sustainability while remaining aligned with its mission.”

How Arvind Limited Works

Arvind Limited is one of India's leading textile manufacturers, known for its vast array of products including denim, woven fabrics, and garments. Established in 1931, the company has diversified into various sectors, including telecommunications and real estate, making it a multifaceted enterprise.

In FY 2022-2023, Arvind Limited reported total revenues of approximately ₹6,020 crore, reflecting a growth of 23% compared to the previous year. The company’s net profit for the same period was around ₹537 crore, a significant increase from ₹317 crore in FY 2021-2022.

Arvind operates through several key business segments:

• Textiles
• Brands & Retail
• Real Estate
• Telecom

Within the textiles segment, Arvind is recognized globally for its denim production. The company holds a market share of approximately 24% in the Indian denim market, making it a leader in this sector. It produces around 130 million meters of denim fabric annually.

In the Brands & Retail segment, Arvind Limited has partnered with international brands such as Levi's, GAP, and Tommy Hilfiger, contributing significantly to its revenue stream. The company operates over 1,200 retail outlets across various formats, including flagship stores, multi-brand outlets, and e-commerce platforms.

Arvind has also ventured into the real estate market, launching several projects in major Indian cities. The company reported a revenue contribution of approximately ₹1,500 crore from its real estate operations in FY 2022-2023.

In telecommunications, Arvind Limited holds a stake in Gujarat-based operator, Adani Group, enhancing its diversification strategy. This segment aims to capitalize on the growing demand for connectivity and digital solutions.

In addition to its core operations, Arvind Limited focuses on sustainability initiatives, aiming to minimize its carbon footprint through eco-friendly manufacturing processes. The company is committed to increasing its use of sustainable materials, targeting a 30% reduction in water consumption by 2025.

As of October 2023, Arvind Limited's stock was trading at around ₹400 per share, showing a year-to-date increase of 15%. The company's market capitalization stands at approximately ₹12,000 crore, reflecting investor confidence in its growth trajectory and diversified business model.

How Arvind Limited Makes Money

Arvind Limited is a diversified conglomerate known primarily for its textiles and apparel business, but it also has interests in various sectors including advanced materials and real estate. The company's operations generate revenue through several key avenues.

Textiles

Arvind is one of the largest producers of denim fabric. According to the company's financial report for FY 2022-23, its textile segment generated revenues of approximately INR 7,500 crore (around USD 910 million), accounting for about 60% of total revenue.

The company operates several manufacturing units across India, producing a wide range of products including woven fabrics, knitted fabrics, and ready-made garments. Arvind’s cotton denim production capacity is around 110 million meters annually, enabling significant economies of scale.

Branded Apparel

Arvind has a strong portfolio of branded apparel products. The branded business segment reported revenues of INR 2,200 crore (approximately USD 270 million) in FY 2022-23, which is around 18% of the company’s total revenues. This segment includes well-known brands such as Arrow, Flying Machine, and US Polo Assn.

Advanced Materials

Another critical revenue stream for Arvind is its advanced materials segment, which includes technical textiles and performance fabrics. This segment reported revenues of INR 1,000 crore (about USD 120 million) in FY 2022-23, making up approximately 8% of total revenues. The growth in this segment is driven by increasing demand in sectors such as automotive and healthcare.

Real Estate

Arvind also generates income through its real estate ventures. The real estate division reported revenues of INR 800 crore (around USD 100 million) in the same fiscal year, contributing about 6% of total revenues. The company has been involved in several residential and commercial projects, leveraging its land holdings for development.

Financial Overview

In FY 2022-23, Arvind Limited reported a consolidated revenue of approximately INR 12,500 crore (around USD 1.52 billion), reflecting a growth of 15% year-on-year.

Arvind's strategic focus on innovation and diversification has allowed it to maintain a steady revenue stream across various segments, effectively mitigating risks associated with fluctuations in any single market segment.

The company continues to invest in value-added products and sustainability initiatives, which are expected to drive future revenue growth.