Gokaldas Exports (GOKEX) Q4 25/26 earnings summary

Executive summary

• FY 2026 was marked by major disruptions, including a 50% U.S. tariff on apparel imports, geopolitical conflicts, and regulatory changes impacting costs and demand.

• India business grew 10% YoY, outperforming a 1.4% decline in the broader Indian apparel export market, while Africa business declined 19% but rebounded 17% YoY in Q4 after AGOA renewal.

• The company passed on over INR 90 crore in tariff discounts to customers and maintained EBITDA margins at prior-year levels, with adjusted EBITDA margin improving to 13%.

• Significant investments and guarantees were made in BRFL Textiles Private Limited, including a 19% equity stake and enhanced corporate guarantee limits.

• Leadership and operational processes were strengthened, and new premium customers were onboarded for both India and Africa.

Financial highlights

• FY26 total income rose 4% YoY to INR 4,065 crore, with revenue from operations up 3% YoY to INR 3,988 crore.

• Adjusted EBITDA grew 19% YoY to INR 530 crore, margin at 13.0% (up 166 bps YoY); Q4 standalone EBITDA margin improved to 12%, consolidated subsidiaries at 5.9%.

• Profit before tax declined 21% YoY to INR 172 crore, and profit after tax fell 37% YoY to INR 100 crore; PAT margin at 2.5%.

• Net debt increased by INR 395 crore, mainly due to CapEx and working capital needs; net debt/equity at 0.17x.

• BTPL reported Q4 revenue of INR 190 crore with a 4-5% EBITDA loss.

Outlook and guidance

• Revenue and margin outlook for FY 2027 is positive, with normalized tariffs and restored competitiveness; India and Africa business margins are expected to improve.

• Africa targets 8-10% EBITDA margin in H2 FY 2027; BTPL expected to exceed INR 1,000 crore revenue in FY 2027, aiming for 6-7% EBITDA margin in H2.

• Working capital is expected to moderate, with a targeted reduction of INR 75-100 crore in FY 2027.

• Revenue growth for FY 2027 is expected to exceed 10-12%, excluding potential FTA benefits.

• Margin improvement of 2 percentage points YoY is anticipated, barring new disruptions.