Gokaldas Exports - Q3FY22 First Cut - ICICI Direct

Posted On : 2022-01-23 08:17:27( TIMEZONE : IST )

Gokaldas Exports - Q3FY22 First Cut - ICICI Direct

(CMP: Rs. 410 MCap: Rs. 2421 crore)

Gokaldas Exports (GEL) reported one its best quarterly performances driven by healthy demand in the US apparel market. Company recorded its highest quarterly revenue and EBITDA in Q3FY22. On account of recent capital infusion through QIP (Rs. 300 crore) company has become net debt free vs. net debt of Rs. 166.2 crore in FY21.

Q3FY22 Earnings Summary

  • On a significantly high base of Q2FY22 revenue grew 17% QoQ (up 97% YoY) to Rs. 520.7 crore (highest quarterly revenue). Production is currently running at peak utilisation levels with robust order book. In Q2FY22, the company had set up two units in Karnataka (Tumkur and Bommanahalli), which is expected to be ramped up in the next six months (potential revenue: Rs. 160 crore)
  • On a QoQ basis, company has maintained its gross margin levels at 49.7% (down 560 bps YoY). Despite material increase in employee (up 11% QoQ) and other expenses (up 36% QoQ), company delivered strong EBITDA margin to the tune of Rs. 11.4% (Q2FY22: 11.7%, Q3FY21: 7.9%). Absolute EBITDA grew 15% QoQ to Rs. 59.4 crore (up 2.8x YoY)
  • Robust operational performance resulted in company reporting a 36% QoQ jump in PBT at Rs. 38.6 crore (Q3FY21: Rs. 6 crore). Owing to ~ 22% effective tax rate (vs. Nil in Q2FY22/Q3FY21), company reported PAT of Rs. 30.2 crore

GEL has initiated work on a new greenfield unit in Madhya Pradesh that is expected to be commissioned in early FY23E (potential revenue: Rs. 150 crore). It has charted out capex of Rs. 340 crore over the next four years (by FY25E) which will have potential to generate incremental revenues worth ~Rs. 1300 crore (4.0x A/To). Further, the management indicated it is looking at entering new business segments like technical textiles, knitwear and setting up manufacturing units in cost efficient countries like Bangladesh. We like Gokaldas Exports as a structural long term story to play the apparel export space.

We will be coming out with a detailed update after the conference call with the management.

Shares of Gokaldas Exports Limited was last trading in BSE at Rs. 409.80 as compared to the previous close of Rs. 373.35. The total number of shares traded during the day was 406870 in over 7787 trades.

The stock hit an intraday high of Rs. 410.65 and intraday low of 365.55. The net turnover during the day was Rs. 164648878.00.

Source : Equity Bulls


GokaldasExports INE887G01027 GOKEX Q3FY22Results FirstCut ICICIDirect