Gokaldas Exports Ltd. share price target

Gokaldas Exports (GEXP), under its new management (since FY18), has witnessed significant changes including marquee client additions, richer product mix, higher margins, etc., leading to robust shareholder returns.

Under the leadership of the new MD (post exit of Blackstone in FY18), Gokaldas has scripted a successful turnaround of its business operations Q3FY22 Results: GEL reported its best quarterly performance driven by healthy demand for apparels in the US apparel market. On a QoQ basis, the company maintained its gross margin levels at 49.7% (down 560 bps YoY). Despite higher opex, GEL delivered strong EBITDA...

The company maintained its gross margins at ~50% (up 140 bps YoY). On account of positive operating leverage and foreign exchange gain, GEL reported one of its highest EBITDA margins of 11.7% (up 285 bps YoY) NWC days increased to 90 days in Q2FY22 (vs. 85 days in FY21) due to...

KPR Mill is among select vertically integrated textile players in India having one of India' largest knitted garment manufacturing capacity of 157 million pieces. It has two major capex projects in the pipeline worth | 750 crore towards garmenting facility (| 250 crore) and ethanol facility (| 500 crore)...

i) US market contributes ~65% of revenues. Demand from the US market is showing strong traction with opening up of the economy. Gokaldas is getting good order flow and expects H2FY21 to be strong in revenue terms, ii) on the pandemic related issues, the management indicated it is engaging with the clients and has sought formal extension of delivery deadlines and does not foresee immediate risk of cancellation of orders, iii) margins may be negatively impacted in Q1FY21 as the management may need to operate extra shifts and pay overtime to workers post lifting of lockdown, iv) the...

i) Capacity utilisation has risen gradually from 15% in April to 80% in September, ii) global demand outlook for apparels from major brands has been encouraging due to increased demand from end consumers. Demand has seen an increasing trend on a MoM basis, iii) the management indicated that shifting of supply chain from China to other countries has gradually started. Global brands both in US and Europe are looking at de-risking their sourcing destinations, iv) Indian players have started to receive orders from new clients and over the longer term would benefit from the China +1...