Sutlej Textiles and Industries Limited (NSE: SUTLEJTEX) Q4 2025 Earnings Call dated May. 09, 2025
Corporate Participants:
Rajib Mukhopadhyay — Chief Financial Officer
Ashish Kumar Srivastava — Wholetime Director and Chief Executive Officer
Analysts:
Vikram Suryavanshi — Analyst
Aditya Sen — Analyst
Unidentified Participant
Diraj Thakur — Analyst
Avnish Burman — Analyst
Moksh Ranka — Analyst
Hari Kumar S — Individual Investor
Presentation:
Operator
, ladies and gentlemen, good day, and welcome to Q4 and FY ’25 Earnings Conference Call for Textiles and Industries Limited. As a reminder, all participant lines will be in the listen-only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star than 0 on your touchstone phone. Please note that this conference is being recorded. This call may contain some of the forward-looking statements that are completely based upon company’s beliefs, opinions and expectations as of today. These statements are not guarantee of future performance and may involve unforeseen risks and uncertainties. The company also undertakes no obligation to update any forward-looking statements to reflect developments that occur after the statement is made. I now hand the conference over to Mr Rajiv, Chief Financial Officer. Thank you, and over to you, sir.
Rajib Mukhopadhyay — Chief Financial Officer
Thank you. Good evening, everyone, and welcome to the earnings conference call of Textiles and Industries Limited for the 4th-quarter and year ended 31st of March 2025. I am the Chief Financial Officer at Textiles and Industries Limited. With me on the call today is our new Chief Executive Officer and Whole-Time Director, Mr Ashish Kumar, along with Mr Ranjan, Chief Operating Officer; and Ire Advisors, our Investor Relationship team. We have already uploaded the investor presentation, and I hope everyone has had an opportunity to go through the same. Let me start the call by giving you the financial highlights of the quarter, after which our CEO will update you on the business as well as the industry highlights. Let me begin by acknowledging that the broader global and geopolitical context continues to shape the business environment, especially the textile industry. While uncertainty remains high, there are some signs of India that could support long-term growth in textiles and manufacturing. For now, we are maintaining a cautious wait and wait-and-watch approach, wait-and-watch approach. Coming to our performance in Q4, this quarter has been better than corresponding quarter of last year, reflecting the execution of strategic initiatives undertaken throughout the year. Our focus on reducing operational costs and improving efficiencies have helped our EBITDA for the year 2025 to INR65 crores from INR minus INR13 crores witnessed in FY ’24. For Q4, our consolidated total income came in at INR686 crores, which was higher by 3% on a year-on-year basis. Gross margin is at 42%. EBITDA for the quarter stood at INR16 crores as against INR13 crores in Q4 FY ’24. PAT was reported minus INR13 crores against a loss of INR26 crores in Q4 ’24. For the full-year FY ’25, our consolidated total income came in at INR2,699 crores as compared to INR2,727 crores in the corresponding year. Gross margin improved by over 12% to INR1,149 crores. PAT was reported at INR68 crores against minus INR136 crores in FY ’24. We are continuously working on the cost optimization and strengthening the balance sheet. Our debt-equity ratio remains consistently below 1, currently it is at 0.97. These ongoing efforts are aligned with our long-term strategic vision and we believe their impact will become even more evident in the coming quarters. With that, I now request Ashish Jee to please take it forward with the business and industry updates.
Ashish Kumar Srivastava — Wholetime Director and Chief Executive Officer
Thank you, Rajeep, and good evening, everyone once again. Thank you once again for joining us on today’s earnings call for Textiles and Industries Limited. As the new Chief Executive Officer, I am grateful for the opportunity to lead this organization and work towards steady progress. Let’s start with the broader context. Global uncertainties and the recent escalations around the India-Pakistan border continue to force challenges. We are closely monitoring the situation and have contingency measures in-place to ensure business continuity. We are also tracking the evolving global tariff situation, particularly in key markets like US, where potential changes could impact trade dynamics. While uncertainties remain, we are prepared to adapt as the situation evolves. Additionally, the earlier logistical disruptions have eased stabilizing raw-material flows and export timelines. On-trade front, the recent India-UK free-trade agreement offers potential opportunities for textile exports. Talks for an India EU FDA are ongoing, which could further support India’s role in global sourcing. We are also monitoring closely the US trade developments where as of now, India appears relatively well-positioned, though further clarity is needed. While global sourcing patterns are shifting, we are cautiously exploring ways to strengthen our supply chains and product offerings to the market. From the global context point-of-view, the global textile and apparel trade valued at about USD2.9 trillion in 225 is expected to grow to about $3.9 trillion by 2032. This is well-supported by the government initiatives in India and we are currently looking at how do we — how do we make use of the facilities which have been provided and extended to us. Turning to our performance, Q4 FY ’25 showed steady results, reflecting efforts to refine our product mix earlier this year. This has contributed to improved gross margins compared to FY ’24. Here is a brief look at our business verticals. The yarn business, which is our largest segment still faces ongoing global demand fluctuations. With apparel trends shifting towards casual wear, we are evaluating other textile segments while exploring modest opportunities in other segments of the textile world. The home textiles, this — while this segment has performed well in-quarter four of this year and we have added new export customers, we are working to build-on this cautiously, keeping in step with the — keeping in step with global design and sustainability expectations. The fiber business, which is our poly conversion — pet bottle conversion business. It last year faced some supply-chain and pricing challenges. However, we see this stabilizing from March onwards and we are — we are working to ensure that we — we are working to ensure that we work at full capacity with almost 80% of our output being used internally for our yarn verticals. Given the recent escalation in India-Pakistan tensions, we are adopting a highly cautious approach. We are prioritizing stability and closely monitoring developments to safeguard our supply chains and workforce. Our focus for FY ’26 is to maintain operational resilience and pursue incremental improvements recognizing the uncertainties ahead. We are committed to delivering value for shareholders through disciplined execution. Thank you for your support. I now request to open the floor for questions.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles participants who wish to ask a question may press star and one now. The first question is from the line of Vikram Suryawanshi from PhillipCapital India. Please go-ahead.
Vikram Suryavanshi
Yeah, hi, good evening, sir. I just wanted to understand, I think there has been some restriction on-trade between and Bangladesh also. So how do you see that playing out the market for particularly young segment in India. And second, with any opportunity what we can see the way we are seeing the FDA happening with UK or something of whatever future FDA is coming up
Ashish Kumar Srivastava
Sure. So I think as you rightly pointed out, there are no restrictions, but I think there are some border, I mean, movement restrictions which is posing some logistical challenges that the yarn cannot go through the regular land route. However, what we are doing is we had earlier also tried the sea option and we are working with our customers. So this basically puts in or elongates the lead-time, but we are working with our customers to work-in advance and mitigate this current challenge, which is kind of being posed due to putting a restriction on land movement. As far as the FTA with UK is concerned, it’s obviously a very welcome news for the entire textile industry. But we are waiting for having some clarity on the entire mechanics, but this should definitely boost the trade between UK and India and give additional opportunities for the Indian textile industry.
Vikram Suryavanshi
Okay, got it. And in terms of cotton, what we have seen the significant fall in international cotton prices. In India, we have seen some correction, but because of MSP, probably there is some limitation as well as the import duty. So is it impacting other spinning players or you see it’s not a material impact on the overall profitability of spinning companies.
Ashish Kumar Srivastava
Yeah. So as you rightly pointed out, yes, there is some price difference between, let’s say, the international cotton pricing in India. However, the good thing is that there is stability in the pricing. Now with this stability, it helps us plan our markets, our product mix. So — and it is definitely much better than what it used to be last year. So we see a stability — this stability continuing even in this coming year. B, some price differential will remain, but I think with this stability in pricing, we’ll be able to kind of cover it through our product offerings?
Vikram Suryavanshi
Understood. And last question, would it be possible for you to share what would be our say buying price or price for green fiber typically for this bottles or basically whatever we import
Ashish Kumar Srivastava
So I think you know normally we don’t discuss our pricing or costing on these calls but I can — all I can say is that currently the bottles — this is a very unorganized sector. You don’t have a regulated segment here and much of it depends upon the demand-supply situation. So in summers, the price goes down because the availability of plastic bottles is higher. In the winters because the consumption of plastic bottles is little less, the price goes higher. It fluctuates..
Vikram Suryavanshi
Understood. But selling price will be in what range? Is it — or since we consume internally, it’s not basically are impacting us?
Ashish Kumar Srivastava
No, sure. So I think, I mean selling price is typically in the — I mean whatever the fresh virgin fiber is, this fiber comes at roughly a 5% to 8% discount to that.
Vikram Suryavanshi
Okay, got it. Thank you very much.
Operator
Thank you. The next question is from the line of Atitya Sain from RoboCapital. Please go-ahead.
Aditya Sen
Hi, thanks for the opportunity. Sir, what is our blended capacity utilization as of FY ’25?.
Ashish Kumar Srivastava
Sorry, Aditya, your question is how much is the capacity utilization? That’s what you asked
Aditya Sen
For the full-year FY ’25.
Ashish Kumar Srivastava
So for the full-year ’25, our effective spindle utilization is close to about 90%, which is about 4% to 5% higher than the previous year.
Aditya Sen
Right. And can you please throw some more light on how the demand is shaping or rather how shaped in Q4 and two months of Q1 FY ’26.
Ashish Kumar Srivastava
So I mean if you look at our product profile, we operate in three-product segments as far as the yarn business is concerned. One is the cotton segment where we do 100% cotton and cotton blended. The second is the synthetic dyed segment and the third is obviously the gray segment of synthetic and cotton. So our specialty has always been the dyed fiber which is then spun into a yarn or the yarn-eyed which we are kind of selling in. In those segments, I think there is reasonable — reasonable strength and we are wanting to build-on that. However, on the core synthetics, which is gray, they are obviously while there is a demand there is also a I mean a general shift from a from a spun synthetic to what you call as filament which comes out cheaper. So there are reasonable challenges?
Aditya Sen
All right. All right, so that was my question. Thank you. Thank you.
Operator
Thank you. The next question is from the line of Kiran D from Table T Capital. Please go-ahead.
Unidentified Participant
Sir, just wanted to check on the US business and generally what you’re hearing from customers abroad, given a lot of variability with many, many things, are you — are you hearing customers cutting back on orders due to demand destruction? I’m hearing prices in the US have gone up substantially for many, many products, not just textiles, but across the product basket that the general consumer buys. So are you hearing any demand disruption from US or the rest of the world market?
Ashish Kumar Srivastava
So as of now, our demand — because you see we operate in the in the yarn segment, which is just the upstream segment. And where the yarn get either converted into a product or it is further processed and then either to a fabric or to a direct to a garment. And then the garment or the fabric converted into garment is what goes into the market. So as of now, our yarn business for US is currently looking stable on the product categories which we operate. But in general your statement that yes, there is a little bit of cut-down from the retailers that seems to be true. What is — what these retailers are actually doing is that they are working with the apparel companies to at least have some share in the base duty, so to say. So they are wanting to pass-on some of that duty onto the converters or all to the apparel manufacturers because otherwise, they will have to really increase — because increasing further the retail price points in US seems a little difficult. So they are looking at various ways and means to ensure that they maintain their margins. So it’s a — I mean, I would say it’s a very typical scenario where once we have more clarity, stability automatically will happen.
Unidentified Participant
Got it, sir. So from now, yarn piece is okay, stable and we are getting increasing business, but the end retailer is probably cutting down in channel inventory and to fair costs,
Ashish Kumar Srivastava
That is true.
Unidentified Participant
Got it. Thank you so much.
Operator
Thank you. Before we take the next question, we would like to remind participants that you may press star and one to ask a question. The next question is from the line of Diraj Thakur from Elara Capital. Please go-ahead.
Diraj Thakur
Hello. Sir, I wanted to understand, do we have any current share in UK? And if yes, how big do you think and the opportunity of the SK can be further and do we have enough capacity to cater the upcoming demand
Ashish Kumar Srivastava
Okay. So I think for the UK market, primarily we are targeting our home business, our home. Yeah, yeah, yeah. We have — we have some exposure there, but it is not — I mean, it is not very large. But the good point — the good part is that we were already in touch with a couple of retailers out there. And we think that in times to come, this business, at least the UK business because the starting base is small can very easily go 3x times for us in such home business.
Diraj Thakur
Okay. Okay. So currently, how much do you think we have like 1% or 2% or very negligible?
Ashish Kumar Srivastava
No, so what — I mean what we do in the export segment because what happens is that some of the retailers which we work are global retailers and they have presence worldwide. So we continue to ship to all destinations for their requirements. So in our — of our export — of our export segment, I think we will be exports to Europe in general around 6% to 7% and in UK, maybe 50% of that.
Diraj Thakur
Okay, understood. So do you think we have enough capacity to cater the upcoming demand?
Ashish Kumar Srivastava
So in terms of — so in the home textiles, they are, let’s say, two, three pieces. One is the weaving capacity. The second is the processing capacity. Processing capacity, we definitely have quite large. As far as the weaving is concerned and the yarn capacity also we have within our system. As far as the weaving is concerned, we could always look at leasing certain assets based on the market demand and make use of the last-mile value addition in processing in-house and cater to the demand as it increases.
Diraj Thakur
I understand. So we have the processing capacity and for the reason we could lease-out.
Ashish Kumar Srivastava
Yes. So because we already have yarns, we already have processing. The mid process of leaving, we could easily lease-out or do a contractual weaving and then bring it back. So capacities are elastic.
Diraj Thakur
I understood, understood. Thank you. Thank you.
Operator
Thank you. The next question is from the line of Himanshu Bisani from Pinpoint X Capital. Please go-ahead.
Unidentified Participant
Hello, sir. Thanks for the opportunity. Sir, I actually wanted to understand the outlook on current domestic demand and pricing scenario. What’s our outlook on that? Thank you.
Ashish Kumar Srivastava
So in the segments we operate and this is true to all segments, in domestic, there is there is always this pressure on the pricing because I think the formats which are doing pretty well in India are the hyper retail formats, which offer, I mean, value to the customers. So there is always a pressure on the pricing because the demand is the maximum amount in that segment.
Unidentified Participant
Okay. And sir, continuing on that, so in our introduction, we also mentioned that we are also looking at new segments to explore. So are you also looking at in terms of margins because 90% — you are operating at 90% and we are not even — we are not throwing margins that we used to do earlier. So what are your thoughts on that?
Ashish Kumar Srivastava
So I think you know, constantly upgrading our product mix because most of our products currently go for apparel application. What we have done consciously and gradually is moving or adding other segments into the — into RKT, like there is — there is a whole carpet segment, there is automotive segment, there are other segments in technical Textiles. So we are currently incubating products which may have applications beyond apparel, which we think are going to drive value for us in times to come.
Unidentified Participant
Understood, sir. We are kind of diversifying from basic apparel business to different applications. So what would be our gestation period or what we can say what when it could come into numbers or what is that basically kind of seeing it significant into our topline?
Ashish Kumar Srivastava
So I think typically what happens transitions depending on the product category we are takes anything between six to nine months because in certain technical products, there is also this element of certification, you know, because the products have to be certified and the whole certifying process itself is anything between six months-to a year. But quick wins here will be moving into segments which are lateral, but can give us higher realization like moving into the carpet industry, which can happen in three to six months. Putting in new products like what we have worked around and we are currently working like looking a Australian product which is similar to a cotton product but behaves like wool and can have different applications. Building putting in a little bit of acrylics into our entire mix and catering or kind of coming up with a newer product for the — for the — even the apparel segment, but in a different category. So those are the things which are kind of in the pipeline, which we are currently baking and it’s a journey, right? I mean, we have already started on that path. We will continue to work on this and possibly based on what the market receptivity is, decide on the final product mix.
Unidentified Participant
Understood, sir. So less lastly, are we looking to have significant capex for this thing and what are we looking at margins after — just after we begin on the journey.
Ashish Kumar Srivastava
So I think you know, let me answer this in two-parts. Whatever capex which we are doing — so basically the spinning process more or less remains the same. What we are putting our capex is more to ensure we remain, you know competitive in terms of upgrading our infrastructure and moving into moving into a product — I mean moving into machines which are required to deliver the products as per the market requirements. So while the capex is more to remain more cost-competitive, the nature of acceptance or the acceptance of these products will define how — how we amplify our journey towards that.
Unidentified Participant
Understood, sir. Thank you so much. Thank you.
Operator
Thank you. The next question is from the line of Berman from. Please go-ahead.
Avnish Burman
Hi, good evening. I just have two questions on your exports and specifically exports to the US. The product that you’re exporting, is that subject to a 10% tariff as of now? Is the understanding correct?
Ashish Kumar Srivastava
That’s right. So two-ways our products get exported. One is obviously the direct yarn, which kind of goes in there. And the other is finally, the conversion of yarn into a fabric and then conversion into a garment which attracts a particular base duty.
Avnish Burman
Okay. So the — I mean, after Trump’s liberation Day, the incremental tariff is on which of these two products. I mean, the incremental 10% tariff.
Ashish Kumar Srivastava
So incremental is on all categories as of now because that’s the base which has been put in. But I mean we are hopeful that as the bilateral kind of comes into picture, we will see where we stand.
Avnish Burman
So as on now, as the products are getting shipped, who is bearing that 10% extra tariffs?
Ashish Kumar Srivastava
So I think that’s what — okay, my earlier response was that we are looking at — I mean, it is a question of negotiation. Now in the end apparel segment, they have kind of agreed for a 50-50 with the converters or the exporters. In our case, since the value addition is in any case nominal, anything between 15% 20% coming to us and balance being borne by them or as the case maybe depending on what the requirements are, it’s in that range.
Avnish Burman
Okay. So fair to assume that if there is a, let’s say, a tariff brunt to be born, the consumers are not taking the entire thing. I mean, the decision has been taken by the industry to kind of absorb it in the supply-chain.
Ashish Kumar Srivastava
So while obviously we are pushing it back, but what happens is that you’re looking at the evolving scenario, they all need to depending on the product category, depending upon the margin you have on the product, depending on the retailer to whom you are servicing, depending on the long-term relationship which you have. And we all — I mean, the industry has to take a little long-term view on how to approach this.
Avnish Burman
Yeah. Understood. My second question is on, you know nobody really knows how this sort of thing will settle. But let’s say India lands up in a better spot as compared to, let’s say, China, Vietnam or Bangladesh. In that case, how do you see — do you see a possibility of market-share shifting between the countries, like either from China to India or Bangladesh to India or Vietnam or India? For the US
Ashish Kumar Srivastava
For sure. So I think there are two things. Most of the retailers today are realising and it is not that it has come because of this duty or the tariff trade or tariff war which has just happened. They all have realized that they need to also have a geography mitigation strategy. So as of now, if you see the share of apparel as far as India is concerned with compared to Bangladesh, China is obviously a joint out there, Vietnam and others is relatively less. So there is obviously a lot of lot of upside which could come to India in the apparel trade for US and also for UK as we kind of move forward. And this is not necessarily a result of the tariff war, but also because brands want to have their — or have a secure supply-chain and they have to have a business continuity mechanism in-place. So short answer, India is poised to grow. We need to — I mean, we are in the right position, we are in the right place. India is mostly cotton upwards, you know on the garmenting side. The bigger challenge or the bigger opportunity, let’s say, for India is to also look at non-cotton fabric processing and non-cotton setting up fiber in India, which can be processed. And then the segments of active segments of protective textiles segments of auto industry applications will become more available for the country.
Avnish Burman
Understood. Thank you so much. This is very clear. Thank you.
Operator
Thank you. The next question is from the line of Moksh Ranka from Aurum Capital. Please go-ahead.
Moksh Ranka
Hello, I’m relatively new to this company. So pardon me if I ask a question which is not so that’s it. So I look at the balance sheet of the company and I think it’s like a door or die situation for the next few years considering a lot of debt in our balance sheet. And according to our comments, I think domestic market is has a lot of pricing pressure. So export is going to be a key driver for us. So what exactly going to be a trigger for us to maybe deliver on at least like some numbers so that we can at least satisfy our best or something like that.
Ashish Kumar Srivastava
So for the question. So I think let Rajiv, your question is that we have a larger debt on our balance sheet. Is what that’s what you’re saying?
Moksh Ranka
Yeah, yeah. And yeah.
Rajib Mukhopadhyay
So I mean, larger is a very kind of a general world, I mean relative also. So I don’t feel we have a book — in books, we have a term-loan of INR450 crores and working capital is at INR418 crores. So I don’t see that to be a kind of a very abnormally high, abnormally low. It is exactly the way it should have been. Working capital for debtors plus out inventory and creditors, if you do, net working capital is exactly in the same level of the loan level. So I don’t see that to be kind of — there is a high debt organization.
Ashish Kumar Srivastava
Okay. So I think there are two things. In a textile company, normally, I mean, these kind of debt levels are considered good. But let me answer your second question, which is more related to what is that we are doing to ensure, I mean, we kind of come out of woods and maintain and excel in this entire piece. So as I said that the focus is on a couple of things, upgrading our product mix. We were very focused on the apparel segment till now. We are trying to see what other segments we can service. And that’s one lever which we have identified. The second lever, which we have kind of identified and are working on is how do we expand our home textile business, which actually gives us because it’s a full product, which is kind of coming in. The third is we are evaluating what are the newer things or areas where we can kind of go into where we really utilize our full potential of what we currently produce. So through a combination of these initiatives, I think we should — we should definitely be moving in a desired direction provided you know the global uncertainties, uncertainties remain calibrated.
Moksh Ranka
So okay. And one more question was, as soon as most Indian textile companies are quite struggling geopolitically as compared to other countries like Banglade, China, which are quite dominant in textiles actually. So could you just give me some color exactly what what are some issues we face and our cost competitivenessness is.
Ashish Kumar Srivastava
No, so I think you know, China is so let’s put it, China is a different ball game. I mean, China still has a very-high labour cost, but is still able to supply or be having to have a lion market-share in textile space because of their product innovation and they are not limited to the cotton supply-chain. They are doing a lot of specialty products, which is going into the market and hence their market-share. Bangladesh works on a different principle. They are basically a midstream textile activity, which is mostly focused on garmenting. So they don’t have they don’t have high capex — as high capex as what the textile companies have, but still convert the — convert the textiles, which they import from either India or anywhere around the world into garments. And because of relatively a low-cost of labor, they are competitive. India has — has inherent advantages on the cotton supply-chain because the entire integrated supply-chain is out here and more-and-more retailers are moving into flexibility, lead-time crashing and all that particular value-added services which the Indian exporters can currently service. What needs to be or what needs to be seen is how India grabs the opportunity which comes to it, which is coming their way because of a China Plus One strategy or let’s say, relative advantage which India will have with respect to the UK FDA or possibly in the US-FDA, which is where we’ll see the real colors after, let’s say two months from now.
Moksh Ranka
Okay. That was quite helpful. Thank you. Thank you.
Operator
Thank you. The next question is from the line of Hari Kumar S, an Individual Investor. Please go-ahead.
Hari Kumar S
Thank you, sir. Am I audible?
Ashish Kumar Srivastava
Yes, very much, thank you.
Hari Kumar S
Okay. Thank you for the opportunity, sir. My two questions, sir, how are the yarn spreads in-going through this year? And the second question is, when are we going to reach our historical margins of 11% to 13% going ahead, sir? Those are my two questions. Thank you.
Ashish Kumar Srivastava
Sorry, what was your second question, but what was the first question?
Hari Kumar S
Our margins — our restalled margins were 11% to 13%, like when are we going to reach that level like you said?
Ashish Kumar Srivastava
Yeah, that’s the second question, right. What is the first question?
Hari Kumar S
So. Spread. Yarn spread.
Ashish Kumar Srivastava
Spread. So I think you see what has happened is that there are certain fundamental shifts which have happened in the market space, right? I mean, so yes, we used to have that 11% — 12% gain, but there are certain fundamental shifts which have happened to the market — in the market space, like you know, the consumption patterns have changed. What we are now doing and what we have been working for the last few months and few quarters is how do we align and how do we change our change ourselves to meet the requirements of the evolving market there. So there, we are changing our product mix. We are working on upgrading our off-product offerings. We would like to move from a commodity yarn business to more value-added yarn business. And while ideally all of us would like to achieve the target which you are setting for us as quickly as possible, I think it’s a journey which we will — which we’ll have to take it together. But we are confident that with the right — with the right team and also with what we have seen in the past few quarters, it’s a journey. And from where we are, for now, it looks a little far, but I think the efforts will surely but will slowly, but surely bear fruit soon.
Hari Kumar S
Okay. About the al spread sir?
Ashish Kumar Srivastava
So the yarn spread, you said, right? Yarn spread means basically the kind of product mix which we have, right? Is that the question?
Hari Kumar S
No, yeah. Okay. Home service.
Ashish Kumar Srivastava
So you know we operate in three segments, right? The — one is the one is the dyed yarn business, which is — which is cotton primarily cotton or cotton blends. The other is what we call as the synthetics diet. And the third one is the plain core polyester or core spun cotton. So obviously, what we have realized is that the core spun and core polyester, these are basically what we call as the drag products. And we are — we have clearly taken a decision that we want to reduce our exposure to the drag products and we want to focus on the hero products which currently are in the category of cotton dyed and cotton, but also work on new blends like Aramids or Acrylics and create new heroes for product heroes for us, which can give us — which can be the contribution driver as we move forward.
Hari Kumar S
Thank you. Thank you so much.
Operator
Thank you. As there are no further questions from the participant. I now hand the conference over to the management for closing comments.
Rajib Mukhopadhyay
Yes, thanks to everybody for your time. And I’m sure this update, whatever we have tried to give you should help you to understand the company’s performance and also the future prospects. Thank you very much.
Operator
Thank you. On behalf of Textiles and Industries Limited, that concludes this conference. Thank you for joining us and you may now disconnect your lines.