Gareth Jones, from British Wool said the price boom came down to supply and demand.

“There are less sheep in Wales, less sheep in the UK, producing less wool and if we look at a comparable market like New Zealand, there are less sheep there.

“They also had a carry-over of wool since Covid – that’s cleared in the last two years,” he added.

Despite less wool being available global interest in using the product has seen a resurgence.

“It is in demand worldwide,” Jones said.

“China is an important market for us, we also have a bedding manufacturer in South Korea, and we have some licensees in Japan.”

As the rising costs in fuel and fertiliser continues to be a challenge for many farmers, making money back from wool comes as a welcome relief to some.

Analysts at global brokerage firm Jefferies remain bullish on Belrise Industries and have reaffirmed their ‘Buy’ rating on the auto components and equipment manufacturer, citing strong new-order traction in the automotive segment and the company’s expanding presence in non-auto sectors such as renewable energy and aerospace.Jefferies analysts Nitij Mangal, Sagar Sahu, Kevin Verghese and Rishi Venkateswaran believe Belrise is well positioned to benefit from rising demand for two-wheelers in India. They expect increasing content per vehicle, along with expansion in four-wheelers and exports, to support the company’s growth.

For its base-case scenario, Jefferies has raised its target price on Belrise Industries to Rs 280 from Rs 250 earlier. The revised target is based on 27x September 2028E earnings per share (EPS), compared with the earlier valuation of 26x FY28E price-to-earnings (PE).

Shares of Belrise Industries closed at Rs 236.80, up 0.71% on Tuesday, August 18. Jefferies’ revised target price implies an upside of around 18% from the current market price.

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Q1 shows resilient operating performance
In its report, Jefferies said Belrise’s earnings before interest, taxes, depreciation and amortisation (EBITDA) grew 5% year-on-year, slightly ahead of its 4% estimate. Profit after tax (PAT) increased 9% YoY but was 6% below estimates, primarily due to lower financial income and a higher tax rate.
The company’s revenue grew 13% YoY, with a 20% increase in manufacturing revenue partly offset by a 19% decline in trading revenue.

Revenue grew 16-22% YoY across commercial vehicles, two-wheelers and passenger vehicles. However, two-wheeler revenue growth was slightly below the industry’s production growth of 23% YoY.

EBITDA margin increased 20 basis points sequentially but declined 90 basis points YoY, aided by a lower contribution from the trading business. Manufacturing margins, however, contracted 20 basis points QoQ and 110 basis points YoY.

Jefferies has cut its FY27 EPS estimate by 3% but has broadly retained its FY28-29 estimates. The brokerage expects Belrise to deliver a 21% EBITDA CAGR and a 25% EPS CAGR over FY26-29E, including earnings accretion from the merger of group entities in FY28.

“Its 29x 1-year forward PE appears rich, but we believe justified for healthy growth and an expanding business footprint,” the analysts wrote in the research note.

Cost pressures show signs of easing

Jefferies noted that Belrise had faced cost pressures over the past two quarters due to higher commodity and fuel prices, as well as increased transportation and labour costs.

The brokerage believes the worst of these cost pressures is now behind the company and has retained its expectation that FY27 margins will remain similar to FY26 levels.

Belrise has historically reported relatively low margin volatility, with EBITDA margins remaining in the 12-14% range during FY21-26, Jefferies noted.

New orders, expansion strengthen growth outlook

Belrise secured multiple new orders in the first quarter, including a chassis order from a fast-growing two-wheeler and three-wheeler OEM, two new OEM additions for braking and suspension products, and an electric vehicle localisation programme from a leading Indian four-wheeler OEM.

The EV programme covers 59 assemblies, along with tooling, fixtures and automation, according to Jefferies.

The company is also expanding its non-auto business. It recently secured an order in the renewable energy segment for sheet metal assemblies from a leading US solar tracker OEM, with peak revenue potential of more than ₹1.5 billion.

Following two recent acquisitions in France and the UK, Belrise has also entered the global aerospace components supply chain.

Jefferies noted that while non-auto revenue currently accounts for a small share of the business, the segment has the potential to meaningfully contribute to medium-term growth.

Customer concentration, margins remain key risks

Jefferies, however, flagged customer concentration and higher-than-expected margin pressure as key risks for the company.

The brokerage noted Belrise’s high dependence on its top customer and, based on industry characteristics, believes this customer to be Bajaj.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

Perini Navi, the Italian superyacht builder behind Mike Lynch’s Bayesian, has been put up for sale by its parent company The Italian Sea Group, which has called for offers by 15 September as it attempts to stave off collapse.

TISG said last week it was offering Perini Navi for sale alongside its Admiral, Picchioti and Tecnomar brands and its shipyards at Carrara and La Spezia, after receiving “numerous unsolicited expressions of interest”.

Lynch, the technology entrepreneur known as Britain’s Bill Gates, died when the Bayesian sank off the coast of Sicily in August 2024, along with his teenage daughter Hannah and five other victims. The £30m yacht was built by Perini Navi in 2008.

TISG, a collection of luxury shipbuilding brands, bought Perini Navi out of bankruptcy in 2021 under a plan to revive it. Since the sinking, the group’s share price has slumped and its sales have collapsed.

The group has also been hit by a financial scandal after it discovered significant cost overruns on major projects run by senior executives. Giovanni Costantino, its chief executive and majority owner, resigned last month in a move that will lead to the departure of the company’s entire board.

It is unclear how much TISG might fetch for Perini Navi, one of the biggest names in luxury yacht building.

Last year TISG sued Angela Bacares, Lynch’s widow, for €456m (£390m), claiming its sales had collapsed since the Bayesian sank. The lawsuit, against Revtom, Ms Bacares’s Isle of Man-based company that owned the yacht, said Perini’s value had fallen since the sinking and that sales had dropped to zero.

“Not only has TISG been unable to sell a single Perini-branded yacht, seeing the ship owners involved in ongoing negotiations vanish, but it has also stopped receiving a single expression of interest from the group of international brokers with whom it collaborates,” the company said at the time.

Sources close to the Lynch family described the lawsuit, which also targets members of the Bayesian’s crew, as “cynical” and “desperate” after it was filed. It is not clear whether Revtom has responded to the claim or how far the case has progressed.

The sale comes amid continued dispute over responsibility for the sinking. Britain’s Marine Accident Investigation Branch has pointed to “vulnerabilities” in the yacht in its interim report, while local reports have said Italian authorities are focused on the actions of the crew.

Two criminal investigations into the sinking have been opened in Italy. According to Italian media, prosecutors have pushed for an expert report into what went wrong to be delivered by the second anniversary of the tragedy, which falls this Wednesday, 19 August. Prosecutors are expected to decide whether to bring charges once the report is filed.

Lynch died weeks after being acquitted of US criminal charges over the $11bn (£8bn) sale of his software company Autonomy to Hewlett Packard in 2011. He had earlier been found liable for fraud by the High Court in a civil case brought by HP, and this year a judge said HP was owed £920m, a sum that would bankrupt Lynch’s estate. Administrators are seeking permission to appeal against the ruling.

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Brokerage firm HDFC Securities has reaffirmed its ‘Buy’ rating on Multi Commodity Exchange of India (MCX), saying regulatory easing could expand the participant base, broaden product offerings and lower margin requirements.

The brokerage expects FPI participation in deliverable contracts and new bullion and metals index options to drive the next leg of growth, with a potential 20-25% increase in options premium. It also sees structural headroom for volume growth as commodity derivatives remain a small share of equity-market trading.

HDFC Securities has set a target price of Rs 3,600 apiece, implying a potential upside of 18.42% from MCX’s August 18 close of Rs 3,040 apiece on the NSE.

Regulatory easing could widen MCX’s participant base

The brokerage highlighted that the FPI consultation paper, already endorsed by the Commodity Derivatives Advisory Committee (CDAC), proposes allowing FPIs in non-agricultural index derivatives and physically deliverable contracts such as gold, silver and base metals, subject to a pre-tender exit condition.

Sebi has also proposed a compulsory square-off or rollover window from T-3, with residual positions transferred to the designated trading member’s proprietary account at the T-1 closing price. FPIs currently account for only around 3% of MCX volumes, versus 16% at equity exchanges.
The second consultation paper focuses on ease of doing business, including removal of close-to-money option series, greater exchange discretion on position limits and outsourcing of position-limit monitoring to clearing corporations.Sebi has also allowed margin exemptions, except mark-to-market margins, for positions backed by early pay-in of certified goods, while extending the benefit to options. The margin and SGF frameworks are also under review.

“These developments amplify our earlier thesis of sustained options growth — supported by both product innovation and structural market reform — and strengthen our conviction on MCX’s long-term earnings trajectory,” wrote Amit Chandra and Arjun Savla of HDFC Securities in a report.

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FPI access, index options seen driving next leg of growth

According to HDFC Securities, the first-order impact of the proposed changes is a boost to volumes. FPIs account for around 5% of volumes in cash-settled contracts such as crude oil and natural gas. Applying a similar activity level to bullion, the premium ADTV could increase by 15-20%.

Additionally, deeper participation could improve domestic price discovery, tighten spreads and strengthen convergence with international benchmarks.

The second-order impact, according to the analysts, is larger and underappreciated: the scaling of index contracts.

BULLDEX and METLDEX exist but do not contribute to premium today because the institutional buyer of a commodity index product, such as an FPI, has been excluded wherever the underlying is physically settled. Removing that restriction could make index options more attractive as the product is cash-settled.

Bullion and metals contracts offer fresh premium opportunity

Base metals offer a parallel opportunity. Metals contribute only around 1% of premium despite a deep physical ecosystem in copper, zinc, aluminium and lead.

FPI access and index access together could support the formation of a genuine metals vertical in options rather than a futures-only franchise.

The analysts estimate that index and metals contracts together could add around 25% to premium and around 20% to PAT over the next two years.

“This optionality is not in consensus numbers. There could be some cannibalization in bullion futures volume but the rise in options/Index volume will be incrementally positive,” said the analysts.

Lower margins could improve capital efficiency and turnover

The third leg, according to the brokerage, is capital efficiency. Initial margins on MCX derivative contracts — crude at around 30%, gold at around 10% and silver at around 25% — are high and directly affect volumes.

“Any rationalization of margins, together with the early pay-in exemption and a lighter SGF, releases capital at both the member and the client level and should translate into higher turnover velocity,” said the analysts.

Valuation remains attractive versus historical levels

Analysts at HDFC Securities pointed out that MCX is down 13% over the last three months but is up 80% over the last one year and 32% year-to-date. The stock trades at 37x FY28E EPS.

Historically, MCX has traded at around a 15% premium to equity exchanges, reflecting its optionality and materially lower regulatory risk. HDFC Securities sees the case for that premium re-establishing itself.

Rising volumes, a stable technology platform, regulatory tailwinds and the option value attached to a visible pipeline of new products have driven the stock’s outperformance to date, the analysts said, adding that they expect this trend to continue.

The stock has traded at a three-year average one-year forward P/E of around 44x and is currently valued at 45x/37x FY27E/FY28E EPS.

“We assign a core P/E multiple of 45x to June-28E core PAT and add net cash excluding the settlement guarantee fund, which yields a target price of Rs 3,600; the implied multiple on Jun-28E EPS is 43x. We keep FY28/29E EPS unchanged and maintain our Buy rating,” wrote the analysts in the research note.

British sports and custom apparel company Y1 Group has acquired university clothing specialist Redbird Apparel in a seven-figure deal, creating a combined business generating more than £7.5 million in annual revenue.

The deal, announced on Tuesday, brings together two founder-led companies that each began with a few thousand pounds drawn from their founders’ student loans. Both have grown without taking on venture capital, funding expansion through profits. The companies said both businesses grew organically, building long-term relationships across education and grassroots sport.

Y1 Group, which appeared on BBC’s Dragons’ Den, supplies bespoke sportswear, teamwear and custom merchandise. Redbird Apparel sells fashion-led university clothing, rapid-turnaround collections and an e-commerce platform. The companies said the combination creates one of the UK’s leading providers of premium branded apparel for schools, universities, sports clubs and organisations.

Chris Rea, founder of Y1 Group, said the deal reflected a change in how organisations buy branded clothing. “Ten years ago, organisations bought branded merchandise to give away. Today, they invest in apparel that builds identity, loyalty and belonging,” he said.

“People want clothing they’re proud to wear – not promotional stash that ends up at the back of a wardrobe. Redbird recognised that shift early, building an exceptional business around great design and customer experience.”

Rea said the acquisition “puts us firmly on track to achieve our 2030 ambition of £20 million turnover and becoming the UK’s fastest-growing sports apparel provider”.

Redbird was founded by Guy Brown and Laurence Snow while the pair were students at the University of Exeter, each investing £1,000 from their student loans. The company has since fulfilled more than 200,000 orders, supplying clothing and merchandise to universities, sports clubs and student societies across the UK, including Oxford and Cambridge.

The founders said Y1 Group’s Dragons’ Den appearance had been well known among student entrepreneurs on the Exeter campus while they were building Redbird, and that the business that inspired them has now bought them.

Brown said: “The company that first inspired us has now bought us. We love that.

“We were both students at Exeter university. We both started Redbird with just £1000 each from our student loans because we believed university clothing deserved to be better. Students wanted apparel that looked and felt like brands they already wore – not generic merchandise designed around the cheapest possible product.

“We focused on building a sustainable business through great products and happy customers, growing to thousands of orders without taking on venture capital. Joining Y1 gives us the scale, expertise and investment to take that vision even further.”

According to the British Promotional Merchandise Association, the UK branded merchandise market is worth more than £1.2 billion annually. The companies said organisations are increasingly prioritising higher-quality apparel that builds long-term brand affinity over short-lived promotional giveaways.

The combined group will offer bespoke custom apparel, rapid-turnaround fashion collections, e-commerce merchandise platforms and branded accessories.

Y1 Group said the deal, an example of growth through acquiring an established business rather than building from scratch, forms part of its long-term strategy to expand across education, grassroots sport and premium branded apparel.

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