Gokaldas Exports shares touch new life high amid strong Q4 performance; stock up over 31% in two sessions

Surging for the second straight session on the back of robust March quarter results, shares of garments and apparel company - Gokaldas Exports touched a new life high of Rs 462.95 per share on the BSE. The shares surged by almost 16 per cent intraday during Monday’s session. 

The stock in the last two sessions has gained over 31 per cent amid strong quarterly performance during the fourth quarter of the financial year 2021-22 (Q4FY22). The stock closed over 15 per cent higher to Rs 462.2 per share on the BSE as against a 0.18 per cent fall in the BSE Sensex.  

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On Friday, Gokaldas Exports reported 280 per cent year-on-year (YoY) surge in consolidated profit after tax (PAT) to Rs 61 crore from Rs 16 crore in the same quarter last year, while its revenue grew 58 per cent year on year (YoY) to Rs 588 crore in Q4FY22 as against Rs 373 crore in Q4FY21. 

Similarly, the company’s consolidated earnings before interest, taxes, depreciation, and amortization (EBITDA) margin improved 170 basis points sequentially and 365 bps YoY to 13.1 per cent on the back of positive operating leverage. 

The key positives that aided the company to report strong quarter performance were increased volume, better product mix, and improved operational efficiency among others. Besides, robust capacity expansion and a rapid ramp-up of production were the primary growth drivers.  

Gokaldas Exports has initiated work on a new greenfield unit in Madhya Pradesh that is expected to be commissioned in early FY23E with potential revenue of Rs 150 crore. It has charted out capex of Rs 340 crore over the next four years which will have the potential to generate incremental revenues worth around Rs 1300 crore, ICICI Securities said in its note on the company. 

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, the brokerage firm said, adding that “We like Gokaldas Exports as a structural long term story to play the apparel export space.”