Gokaldas Exports slips 10% in 2 days post Q4 results; time to buy?

The management said there is a considerable amount of effort required to improve the margins further over the next few years as the company continue to consolidate and grow the business

Gokaldas Exports share price today

 

Shares of Gokaldas Exports were under pressure for a second straight trading day on Friday, down 3 per cent to ₹931.75 on the BSE in today's intraday trade in an otherwise strong market. In the past two trading days, Gokaldas Exports shares have declined 10 per cent after the garments & apparels company reported its March 2025 quarter (Q4FY25) results.

 

At 10:59 AM, Gokaldas Exports stock was trading 2.8 per cent lower at ₹934.15, as compared to 1.1 per cent rise in the BSE Sensex. Thus far in calendar year 2025, the stock has slipped 18 per cent as against a 4 per cent rise in the benchmark index. The stock had hit an all-time high of ₹1,260 on December 18, 2024.  Catch Latest Stock Market Updates Today LIVE

 

 

Q4 results, management commentary

 

Gokaldas Exports registered a total income growth of 27 per cent year-on-year, whereas profit before tax grew 84 per cent Y-o-Y in March 2025 quarter (Q4FY25), at ₹1,035 crore and ₹79 crore, respectively.

 

Earnings before interest, taxes, depreciation and amortisation (Ebitda) margins improved by 272 bps to 13.7 per cent on a Y-o-Y basis during the quarter, supported by productivity gains and robust cost management efforts. Profit after tax grew 19 per cent Y-o-Y and 5 per cent sequentially at ₹53 crore.

 

The management said there is a considerable amount of effort required to improve the margins further over the next few years as the company continues to consolidate and grow the business. "As we step into FY2026, the reciprocal tariff imposed by the US poses a formidable challenge by inducing business volatility and margin pressure. The recently concluded India-UK free trade agreement (FTA), however, presents an opportunity as and when it is implemented," the management said.

 

JM Financial Institutional Securities re-iterates 'buy', share price target of ₹1,265

 

India remains a key player in sourcing strategies for all customers. Higher tariff on China and political uncertainties in Bangladesh contribute to the overall attractiveness of the country as a sourcing destination. The recently announced India-UK FTA offers a 12 per cent duty advantage over China and puts India on par with Bangladesh, creating a strong export potential. Gokaldas exports have established relationships in the UK via Matrix subsidiary and may scale up relatively faster than peers.  ALSO READ | How much upside can ITC stock see post Q4 results? Find out here

 

"In order to benefit from the India-UK FTA, the company plans to direct its capacities towards the UK with no loss in volumes for the US business. The longer term seems favourable with a continuing shift of global sourcing away from China given higher tariffs, supplier consolidation towards efficient and well capitalized players, and supply-side instabilities in several countries. Gokaldas exports remain our top pick in the textile space," they brokerage said with a 'BUY' rating and a 12-month target price of ₹1,265 per share.

 

CRISIL Ratings Rationale

 

Crisil Ratings, on May 12, 2025, upgraded its rating on the long-term bank facilities of Gokaldas Exports to 'Crisil A+/Stable' from 'Crisil A/Positive'. the short-term rating has been reaffirmed at 'Crisil A1'.

 

Gokaldas Exports benefits from its established relationships with reputed global apparel retailers in North America and Europe, recurring orders and steady increase in wallet share with key customers. Despite uncertainty in the market due to US tariffs, the overall business risk profile is expected to remain stable for Gokaldas Exports. However, overall profitability impact due to introduction of new tariffs against Indian imports in the USA and its impact on Gokaldas Exports' profitability will remain a key monitorable.

 

The company's over 90 per cent of revenue came from exports, with Northern America accounting for 84 per cent, followed by Asia at 11 per cent. The complementary product, customer and geographic profiles of the Atraco group and MCPL, diversity in geographical reach and clientele will support the overall business risk profile, Crisil Ratings said.  ALSO READ | Why did Ramco Cements share price fall 3% in trade on Friday, May 23?

India's textile exports to the UK set to double under new FTA: ICRA report

 

The landmark FTA between India and the United Kingdom, finalized, is poised to significantly boost India's textile exports to the UK. The agreement eliminates tariffs on 99 per cent of Indian goods, including apparels and home textiles, removing the current 8-12 per cent duty and placing Indian exporters on par with competitors like Bangladesh, Vietnam, and Pakistan. China leads UK textile imports (25 per cent share), followed by Bangladesh (22 per cent), Turkey (8 per cent), and Pakistan (6.8 per cent). The FTA will enhance India’s competitiveness in this market.

 

India's apparel and home textiles trade with the UK is projected to double in the next 5-6 years, with export volumes expected to grow at a compounded annual rate of ~13 per cent. The UK's share in India's textile exports is anticipated to rise from 7-8 per cent to 11-13 per cent by CY2027.  India is currently the 12th largest trading partner of the UK and ranks fifth in apparel and home textiles imports, with $1.4 billion worth of exports in CY2024, 6.6 per cent share of UK’s textile imports.  

 

The agreement is set to be operational in CY2026, pending legal review, marking a transformative milestone for India’s textile sector and bilateral trade with the UK.  ALSO READ | Concor shares drop 4% as Q4 profit, revenue slip; earnings breakdown here

 

About Gokaldas Exports

 

Gokaldas Exports manufactures and exports readymade garments for men, women, and children, and caters to several leading international fashion brands and retailers. In fiscal 2018, Clear Wealth Consultancy Services LLP, led by Mr Mathew Cyriac, acquired a 39.94 per cent stake in the company, from Blackstone FP Capital Partners (Mauritius) VB Subsidiary Ltd. The latter holds a 10.09 per cent stake in the company. The company has more than 30 manufacturing facilities in and around Bangalore.