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Robust revenue growth across regions

Gokaldas Export (GEXP) revenue grew 20.7% YoY to INR11.5b in 1QFY27, led by higher growth in Africa business followed by domestic business. India business revenue grew 17.8% YoY to INR7.5b. EBITDA margin settled at 9.8% (-40bp YoY), due to higher wage & transport cost. Africa business grew 44% YoY while margin came in at 7.9% (-60bp on YoY) due to higher wage cost. Management is confident to reach USD110-112m by FY27 by looking at the current order book visibility and expect margin to reach double digits by 2HFY27. BTPL revenue for the quarter was INR1.7b with EBITDA loss of ~7.5-8%. Management expects BTPL to achieve mid-to-high single-digit EBITDA margin by 4QFY27. Management has raised its revenue growth guidance to 15%+, from the earlier mid-teens expectation, while guiding for EBITDA margin to remain above 10% for FY27

Strong demand, improving sourcing dynamics, and capacity-led growth

GEXP reported a strong 1QFY27, with consolidated revenue growth of 20.7% YoY, driven by broad-based growth across customers and geographies. India revenue grew 17.8% YoY, supported by improving tariff competitiveness and increasing customer inquiries across product categories. Africa remained a key growth engine, delivering 44% YoY growth, with FY27 revenue visibility of USD112-115m against the USD120m target. BTPL is progressing well, with improving utilization and product mix, and is expected to merge in 3Q with margin improvement. Jharkhand and Karnataka facilities involve total investment of around INR1b and are expected to generate around INR3.5b of revenue at steady state. Further, the company is going to add 2-3k additional machines under evaluation and new Karnataka/Jharkhand facilities to support the FY29 growth opportunity

Margin improvement through better product mix

In 1Q, gross margin expanded 130bp YoY to 52.4% despite higher RM costs, particularly polyester/synthetic fabrics, cotton yarn 1Q orders had been priced earlier. EBITDA grew 15.6% YoY to INR1.1b, with EBITDA margin at 9.8% (-40bp YoY), as India’s wage costs increased by ~INR200m in 1Q, including significant minimum-wage hikes in some states. We believe the Africa business is expected to achieve ~6.5% EBITDA margin by FY27, while BTPL is expected to reach ~4% EBITDA margin over the same period. Overall, we expect EBITDA margin to improve to 10%+ led by higher utilization.

Valuation and view: Reiterate BUY

We believe GEXP benefits from a well-diversified portfolio and a multi-country manufacturing model, providing a competitive edge over peers, though clarity on AGOA may slow the Africa growth story in the medium term, in our opinion. As integration stabilizes, we expect margin improvement of ~215bp over FY26- 28E. We tweak our earnings due to better visibility and reiterate our BUY rating with an EV/EBITDA-based TP of INR1,110, valuing the stock at 14x FY28E EV/EBITDA. Key risks: tariff and US exposure risk, raw material and cost pressures, and project and customer concentration risk. (refer to our IC note dated Jun’26).

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