Precot Ltd. (PRECOT) AI Stock Analysis

• Market Cap: ₹4.30B
• Dividend Yield: 0.7%
• Average Volume (3M): 5.89K
• Price to Earnings (P/E): 13.6
• Beta (1Y): 1.24
• Revenue Growth: -8.05%
• EPS Growth: -23.39%
• Country: IN
• Employees: 2,224
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Apparel - Manufacturers
• EPS (TTM): 5.86
• Shares Outstanding: 12,000,000
• 10 Day Avg. Volume: 9,661
• 30 Day Avg. Volume: 5,894
• PEG Ratio: 0.17
• Price to Book (P/B): 1.19
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 13.56
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ₹487.00 ▲(26.38% Upside)

Precot Ltd.'s overall stock score reflects a stable financial performance with some operational improvements, but challenges in revenue consistency and debt management persist. Technical indicators suggest a bearish trend, while valuation metrics are reasonable but not compelling. The absence of earnings call data and corporate events limits further insights.

Positive Factors

Operational Efficiency

Enhanced operational efficiency indicates better cost management and production processes, supporting long-term profitability and competitiveness.

Market Diversification

Diversified market presence reduces dependency on a single market, providing stability and growth opportunities across different economic conditions.

Product Innovation

Innovation in product offerings can lead to higher margins and customer loyalty, strengthening the company's position in the competitive textile industry.

Negative Factors

Revenue Growth Challenges

Inconsistent revenue growth can hinder long-term strategic planning and investment, impacting the company's ability to scale and compete effectively.

High Debt Levels

High debt levels can increase financial risk and limit the company's ability to invest in growth opportunities, affecting long-term sustainability.

Free Cash Flow Volatility

Volatile free cash flow can restrict financial flexibility and the ability to fund new projects or return capital to shareholders, impacting long-term growth.

Precot Ltd. Business Overview & Revenue Model

Company Description

Precot Limited engages in the manufacture and sale of yarn and technical textile products in India. It offers hygienic products, such as cotton pads and balls, exfoliating pads, cotton wool rolls and pleats, cotton spunlace rolls/tapes, and absorbent cotton fiber. The company also provides cotton yarns and threads that are suitable for weaving, crocheting, sewing, and textile production. Its products are used for cosmetic, personal hygiene, and medical use. The company also exports its products. The company was formerly known as Precot Meridian Limited and changed its name to Precot Limited in December 2020. Precot Limited was incorporated in 1962 and is based in Coimbatore, India.

How the Company Makes Money

Precot Ltd. generates revenue through multiple streams, primarily from the sale of its core products such as cotton and blended yarns, greige fabrics, and finished textiles. The company engages in direct sales to manufacturers in the apparel and home textiles sectors, as well as exports to international markets, which contribute significantly to its earnings. Additionally, Precot Ltd. has established partnerships with various retailers and brands, enhancing its market reach and driving sales volume. The company also focuses on value-added products, which generally yield higher profit margins, thus diversifying its revenue base. Furthermore, improvements in operational efficiency and cost management play a crucial role in enhancing profitability.

Precot Ltd. Financial Statement Overview

Summary

Precot Ltd. exhibits a stable yet cautious financial position. Improvements in operating margins and cash generation are notable, but challenges remain in achieving consistent revenue growth and managing high debt levels.

Income Statement

Precot Ltd. shows a mixed performance in its income statement. The gross profit margin has improved over the past year, indicating efficient production and cost management. However, the net profit margin remains modest, reflecting challenges in converting sales into net earnings. Revenue growth is inconsistent, with a slight decline in the most recent year. The company has managed to increase its EBIT and EBITDA margins, demonstrating improved operating efficiency.

Balance Sheet

The balance sheet of Precot Ltd. displays moderate financial stability. The debt-to-equity ratio indicates a balanced use of debt and equity, although the total debt levels remain relatively high. The return on equity shows recovery, yet it is still not at an optimal level. The equity ratio suggests a solid asset base, supporting the company’s financial structure but highlighting potential risks from high leverage.

Cash Flow

Precot Ltd.'s cash flow statement reflects reasonable cash management with positive operating cash flow trends. However, free cash flow growth is inconsistent, and the company faces challenges in maintaining a strong free cash flow to net income ratio. The operating cash flow to net income ratio is healthy, suggesting good cash generation relative to net income, although there are fluctuations in capital expenditures impacting free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	9.28B	8.68B	9.33B	9.54B	9.93B	6.65B
Gross Profit	3.64B	2.88B	2.73B	485.84M	4.30B	2.84B
EBITDA	1.12B	1.15B	767.05M	379.73M	1.97B	998.17M
Net Income	347.85M	328.87M	167.82M	-260.23M	1.05B	329.48M
Balance Sheet
Total Assets	0.00	9.39B	9.54B	9.07B	9.33B	7.62B
Cash, Cash Equivalents and Short-Term Investments	94.75M	147.25M	133.05M	25.99M	14.86M	10.94M
Total Debt	0.00	3.29B	3.73B	3.79B	3.60B	3.29B
Total Liabilities	-4.48B	4.90B	5.36B	5.01B	4.89B	4.20B
Stockholders Equity	4.48B	4.48B	4.18B	4.06B	4.44B	3.42B
Cash Flow
Free Cash Flow	0.00	394.01M	465.00M	173.28M	-12.84M	145.46M
Operating Cash Flow	0.00	840.89M	1.21B	492.33M	555.39M	260.06M
Investing Cash Flow	0.00	-367.41M	-693.69M	-300.55M	-547.88M	-82.75M
Financing Cash Flow	0.00	-807.11M	-504.13M	-233.59M	9.29M	-167.85M

Precot Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 385.35
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:PRECOT, the sentiment is Negative. The current price of 385.35 is below the 20-day moving average (MA) of 403.81, below the 50-day MA of 431.89, and below the 200-day MA of 475.25, indicating a bearish trend. The MACD of -22.32 indicates Positive momentum. The RSI at 36.08 is Neutral, neither overbought nor oversold. The STOCH value of 17.76 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:PRECOT.

Precot Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TPLPLASTEH	71 Outperform	₹5.13B	19.93	―	1.49%	14.78%	19.77%
PRECOT	66 Neutral	₹4.30B	13.64	―	0.70%	-8.05%	-23.39%
INDOBORAX	63 Neutral	₹8.18B	18.41	―	0.38%	12.35%	6.79%
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
MMP	58 Neutral	₹6.33B	27.36	―	0.78%	26.79%	-35.43%
NGLFINE	54 Neutral	₹8.93B	43.24	―	0.13%	9.83%	-50.02%
SUTLEJTEX	45 Neutral	₹4.75B	-5.27	―	―	-1.07%	-5.16%

Precot Ltd. Corporate Events

Precot Confirms SEBI Compliance on Dematerialisation for December Quarter

Precot Limited has notified the stock exchange that it has received the requisite confirmation from its Registrar and Share Transfer Agent, MUFG Intime India Private Limited, under Regulation 74(5) of the SEBI (Depositories and Participants) Regulations, 2018 for the quarter ended 31 December 2025. The certificate confirms that all securities submitted by depository participants for dematerialisation during the quarter were duly accepted or rejected, listed on the appropriate stock exchanges in line with existing securities, and that corresponding physical certificates were verified, mutilated, cancelled, and replaced with depository records as registered owners within prescribed timelines, underscoring the company’s compliance with regulatory requirements and reinforcing governance standards for its shareholders and market participants.