Ajay Patodia CFO of the company addressed the call.

Highlights of the call:

Lux Industries is one of the largest players in the hosiery business having a market share of around 20% of the organised industry.

Lux Industries has been in the forefront creating milestones within the hosiery industry and taking the brands across national and international borders by identifying such market needs and deliver products which are widely accepted.

Its products include Men's, Women's & Kids Innerwear, Winterwear, Socks & Slacks for Women in varied colours and designs.

It has around 5,000 SKU's under various Brands and Sub Brands of LUX.

It focuses on growing exclusive retail outlets to provide seamless buying experience.

The company's products are available in around 4,50,000 retail points spread across India.

LUX has a presence across the globe with exports to 47 countries.

The management was very pleased to end FY19 on a positive note. In FY 2019 total revenue stood at Rs 1218 crore, up 13%. EBITDA and PAT were at Rs 190 crore and Rs 101 crore respectively.

PAT Margins improve 110 basis points to 8.3%.

For FY 2018-19, export contribution to revenue was 11%.

Q4 gross margins were down due to higher discounts given to dealers to improve the cash flow. Also input costs were higher in Q4, which has now settled down. Gross margin is expected to improve going forward.

Q4 other income consists of Rs 4 crore due to valuation of shares in a company, Rs 4 crore forex gains an Rs 1 crore received as insurance proceeds.

The company increased the number of countries it has exported from 22 to 47 over the past 5 years.

The company expects exports to increase from the current Rs 136 crore in FY19 to reach Rs 175 crore in FY20.

Focus has been to reduce working capital requirements.

For FY19, it has been able to significantly improve operating cash flows. Operating Cash Flows for FY19 turned positive to Rs 185 crore. Going forward, aim is to reduce the working capital cycle further.

With mounting need for quality and comfort along with fashion in the innerwear industry, there has been a major shift in the industry and has helped the organised innerwear segment to gain its market share from the unorganised players.

Lux Industries continues to expand its portfolio into high value and niche segments.

Lux Cozi is one of the strongest and fastest growing men's innerwear brands (economy and mid segment)

LUX has always focused on constantly launching new products to cater the change in consumer demands.

During the quarter it launched India's first scented vest range under brand Lux Cozi.

To fight the rising mercury during summers the refreshing scented vests will be a landmark product in the men's innerwear category.

By being the pioneer to launch scented vests in India, Lux will be able to grab the market share.

It intends to launch many more products in the coming months that will add to its market leadership.

With this new range of vests, Lux Cozi is taking a phenomenal leap in the process of creating value-based products keeping in mind the essential necessity and aspirational style quotient of India.

The company has been continuously working on improving financial and operational efficiencies.

Growth in profitability is mainly attributable to changing product mix, optimum capacity utilisation and focussed marketing and brand building initiatives.

It expects premium products to grow at a CAGR of 30% in the next 2-3 years. Premium en products are growing faster than the economy products.

100% of its products are manufactured in-house with zero outsourcing

It has invested extensively in manufacturing integration and scale with the objective to reduce costs.

It has strong presence in Western & Central India with highest absolute sales from Madhya Pradesh, U. P. and Uttarakhand.

The company is creating an online presence through e-commerce websites, enhancing access and image.

Its agreement with CSE Consultancy LLP, licence owner of brand One8 with its premium brand CNN to manufacture and market its products globally will help Lux increase share in the premium portfolio. During the current quarter it saw a good traction for the product in the market.

LUX Industries will be manufacturing and marketing a unique collection of socks, innerwear and sleepwear for One8, globally

With One8, the company aims to disrupt the premium innerwear segment through innovative product offerings. It feels extremely confident its distribution and resource strength, coupled with the youth appeal of Virat Kohli will make One8 the most preferred brand in the premium category

The company is expanding with a state-of-the-art 12 lakh sq. ft (approx) manufacturing facility in Dankuni, West Bengal. Cost of the project is Rs 83 across 11.48 acres on the outskirts of Kolkata. It has the capacity to produce 5 lakh units of finished products a day. Phase-II expansion will double the production capacity over the next 3-4 years.

On the merger front, the company is in the process of evaluating various options to complete the merger o fJ.M. Hosiery & Co. Ltd. and Ebell Fashions Pvt. Ltd. with Lux Industries and expect it to be completed as soon as possible after meeting all the regulatory requirements and processes.

In 2020 the company hopes to achieve revenue of Rs 1,500 crore.

In 2020 it hopes to improve EBITDA margin by 100 to 150 basis points.

The company hopes to constantly add new and innovative products for gaining significant market share.

It hopes to capture market share in various other countries in the world to increase export contribution.