Volume sales, margin expansion to drive Arvind Mills: Rajesh Jain

Rajesh Jain, Market Strategist

Great expectations but low returns, that's how the equation has been on Arvind Mills?

Rajesh Jain: Unlike Raymond, Arvind Mills did not have too many of the diversifications to get rid of and presently if you look at the volume growth within the company and the manner in which the product mix has changed, the company is actually facing a capacity constraint and it is spending on capacity expansion for its denims and shirtings business. Going forward the two positive triggers in this stock apart from a possible sale of some real estate that the company still has on its books are just the core fundamental drivers of business, which is volume sales and margin expansion.

Cotton prices are expected to head down southwards and the branded apparel business as well as the pure fabric business exports are all picking up and it is the combination of volume and margins in a business, which has probably seen the worst, which makes me be positive on Arvind Mills as one of the better placed within the textile space, which will reward investors well over the next 12-18 months.