Why I bought KPR Mills in 2014 and why it Multiplied 60 Times?
Why I bought Mold-Tek Packaging and why it Multiplied 46 Times in 7 years?
August 19, 2016
Long Term Investing Vs Short Term Investing
June 11, 2017
KPR Mill Ltd
Around 2014 I bought KPR Mill at a split-adjusted ₹10. It wasn’t exciting. Textiles are about as unglamorous as the market gets. Today the stock trades near ₹1,062 — a return of roughly 106 times. When I first wrote about it, it was a ~60-bagger; simply holding a great business has since compounded that into a ~106-bagger. Here is why I bought it, and why I never sold.
A boring business done exceptionally well
KPR Mill is one of India’s largest vertically integrated textile companies — it spins its own yarn, knits its own fabric, and stitches its own garments, all the way to the finished export. On top of that it runs a profitable sugar and ethanol business and owns the FASO innerwear brand. Integration is its moat: by controlling every step, it protects its margins in an industry where most players are squeezed at both ends.
The fundamental strengths that made me buy
- True vertical integration. Yarn to fabric to garment under one roof — the whole value chain is captured internally, which is rare in Indian textiles and is the source of its durable margins.
- A high-quality compounder. Return on capital near 20% and return on equity of ~17%, held consistently for years — the signature of a genuinely well-run business.
- Serious scale and profits. FY25 revenue of ~₹6,388 crore and net profit of ~₹815 crore, supplying global apparel brands at volume.
- Sensible diversification. Sugar, ethanol and the FASO retail brand add cash-generative legs beyond textiles, riding the ethanol-blending tailwind.
- A strengthening balance sheet. Borrowings cut sharply (to ~₹466 crore), moving the company toward a net-cash position while it keeps growing.
- Structural tailwinds. The China+1 shift in global sourcing and a possible India–EU trade deal both point more apparel orders toward exactly this kind of integrated Indian manufacturer.
Why holding beat trading
The temptation with a big winner is to sell after it doubles. KPR taught me the opposite. A business that keeps earning ~20% on its capital, keeps expanding capacity, and keeps its balance sheet clean does not need me to trade it — it compounds on its own. The ~60× I first wrote about has become ~106× for one simple reason: I let a great business do the heavy lifting, year after year.
Don’t take my word for it — it’s on the public record
My original buy call on KPR Mill is a matter of public record on my Facebook profile, made years before the stock became a market favourite. Buying it was easy; the real edge was the temperament to keep holding while it multiplied.
“The big money is not in the buying or the selling — it is in the waiting, on a business that quietly compounds while everyone else is distracted.”
The lesson for you
KPR Mill is my case study in patience. Find a genuinely integrated, well-managed, cash-generative business at a fair price — then get out of its way. The most powerful force in the market isn’t timing; it is a great business held for a very long time.
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Disclaimer: This article is a personal account of my own past investment decision, shared for educational purposes only. It is not a recommendation to buy or sell this or any stock at current prices. All return figures are calculated to recent market prices and adjusted for stock splits and bonuses; past performance is not a guarantee of future returns. Equity investments are subject to market risks. Please do your own research or consult your financial adviser before investing.
