Lux Industries Ltd, one of India’s largest hosiery manufacturers, is focusing on margin recovery, tighter working capital management and cost rationalisation as it enters FY27.
The company is also looking to leverage investments made in brands, manufacturing and technology to strengthen its position in the mid-premium hosiery segment.
Lux has an annual production capacity of 44 crore garment pieces across nine manufacturing facilities in West Bengal, Tamil Nadu, Punjab and Uttar Pradesh.
Investments begin to converge
“The long-term prospects for the hosiery industry remain favourable, supported by rising incomes, greater brand consciousness, premiumisation and the shift towards organised players, said Managing Director Pradip Kumar Todi in a letter to shareholders.
“For Lux specifically, the investments we made over several years are now beginning to converge into a coherent whole,” he said adding “This includes a broader portfolio, stronger brands, more efficient manufacturing and smarter technology platforms.”
Focus on margin improvement
Chief Financial Officer Ajay Nagar said the company’s immediate priorities include margin recovery and tighter financial discipline.
“First, the management will focus decisively on margin recovery. Second, working capital discipline will be restored progressively as the new brands mature. Third, cost rationalisation will be pursued in earned advertising spend,” he said.
Geopolitical risks remain
As we enter FY27, the ongoing geopolitical conflicts and war-driven disruptions are expected to continue putting pressure on Lux Industries.
The company plans to balance growth investments with tighter cost and working capital management as it navigates the next phase of its business, he said.
Changing market dynamics
Lux has built its business over nearly seven decades and has evolved alongside the growth of consumer India.
The company said its next phase will focus on strengthening established capabilities while responding to changing market dynamics and creating new avenues of growth.
Three businesses take shape
The company’s ongoing demerger into three business verticals is intended to give each business greater strategic focus and operational agility.
Chairman Ashok Kumar Todi said the structure would allow the businesses to pursue their own growth trajectories while retaining Lux’s entrepreneurial culture and long-established relationships.
“Each business will gain a greater strategic focus, higher operational agility, and sharper accountability,” he said.
Strategy centred on value creation
Todi said the three businesses would continue to be guided by entrepreneurship, quality, technology, integration, efficiency and expansion.
“Over time, we believe this structure will enable sharper capital allocation, improve strategic clarity, and unlock meaningful value for all shareholders,” he said.