GHCL Textiles Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript GHCL Textiles Ltd filed with BSE on 06 May 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
GHCL Textiles reported Q4 FY26 revenue of INR375 crores, up 31% year-on-year, with EBITDA of INR52 crores and PAT of INR28 crores, while full-year FY26 revenue rose 14% to INR1,335 crores and full-year EBITDA grew 34% to INR156 crores. Management attributed the quarter's performance to demand tailwinds in export and domestic markets, higher spreads, and stabilisation of the newly commissioned 25,000 spindle unit and knitting machines. The company also disclosed a net debt of INR118 crores, a temporary rise in working capital from increased cotton procurement, and receipt of land allocation in the PM MITRA Park in Virudhunagar, Tamil Nadu.
Numbers mentioned
Revenue: INR375 crores (Q4 FY26)
p. 4
“In quarter 4, revenue increased to INR375 crores, up by 31% on year-on-year basis.”
Marshal Sonavane, page 4 of the filed PDF · View the filing
EBITDA: INR52 crores (Q4 FY26)
p. 4
“EBITDA came in at INR52 crores and PAT at INR28 crores.”
Marshal Sonavane, page 4 of the filed PDF · View the filing
Revenue: INR1,335 crores (FY26)
p. 4
“For the full year FY26, revenue came in at INR1,335 crores, which is an increase of 14% over last year.”
Marshal Sonavane, page 4 of the filed PDF · View the filing
EBITDA: INR156 crores (FY26)
p. 4
“Also, full year EBITDA came in at INR156 crores, which increased significantly by 34% over last year.”
Marshal Sonavane, page 4 of the filed PDF · View the filing
Net debt: INR118 crores (FY26)
p. 4
“Further, our balance sheet remains strong with net debt of INR118 crores, which represents 0.1 x net debt to equity ratio.”
Marshal Sonavane, page 4 of the filed PDF · View the filing
Spread: INR148 per kilo (Q4 FY26)
p. 6
“our spread in Q3 was about INR123 per kilo, which has gone up to about INR148 kilo in Q4.”
Marshal Sonavane, page 6 of the filed PDF · View the filing
Fabric contribution to revenue: 12% (FY26)
p. 9
“So definitely fabric has gone up to 12%.”
Marshal Sonavane, page 9 of the filed PDF · View the filing
Spindle utilization: 98% plus (Q4 FY26)
p. 11
“In Q4, we achieved 98% plus utilization.”
Marshal Sonavane, page 11 of the filed PDF · View the filing
Cotton inventory days: 120 days (as of 31 March 2026)
p. 9
“We have approximately around 120 days of inventory as on 31st of March.”
R. S. Jalan, page 9 of the filed PDF · View the filing
Other income (land sale profit): INR8-point-something crores (FY26)
p. 16
“there was a sale of nonstrategic or noncore land parcel, which we have done. And out of that, about INR8-point-something crores of profit has been realized.”
Marshal Sonavane, page 16 of the filed PDF · View the filing
FY27 capex plan: INR100 crores to INR120 crores (FY27)
p. 11
“So FY27 capex plan will be between INR100 crores, INR120 crores.”
Marshal Sonavane, page 11 of the filed PDF · View the filing
Dividend payout ratio: 8% (FY26)
p. 16
“So last year, the payout was 8%. This year also, we have retained our payout of 8%.”
Raman Chopra, page 16 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Spread — INR148 per kilo · Q1 FY27
stated conditionally by Marshal Sonavane
p. 5
“at least for quarter 1, we have a visibility that the spreads look to be continuing.”
Marshal Sonavane, page 5 of the filed PDF · View the filing
Revenue — INR2,000 crores · 3 years
stated firmly by Marshal Sonavane
p. 12
“Yes. We are sort of putting an anchor on that. We are holding on to that.”
Marshal Sonavane, page 12 of the filed PDF · View the filing
EBITDA margin — 15% to 18% · next 3 years
stated as an aspiration by Marshal Sonavane
p. 13
“I think if we continue to maintain that definitely 15% to 18% margin is a within the next 3 years.”
Marshal Sonavane, page 13 of the filed PDF · View the filing
Revenue and EBITDA margin target timing — INR2,000 crores revenue and 15% to 18% EBITDA margin · FY29 to FY30
stated as an aspiration by Marshal Sonavane
p. 19
“So as for our internal guidance, we are sort of aiming for FY29 at least for the top line, maybe around FY30.”
Marshal Sonavane, page 19 of the filed PDF · View the filing
Working capital days — 110 to 120 days
stated as an aspiration by Marshal Sonavane
p. 18
“But it usually has been between 110 to 120 days for us also. And I think that is the level we are planning to maintain.”
Marshal Sonavane, page 18 of the filed PDF · View the filing
ROCE — double digit
stated as an aspiration by R. S. Jalan
p. 19
“we have an objective to go to a double digit of the ROCE going forward.”
R. S. Jalan, page 19 of the filed PDF · View the filing
Solar capex benefit — INR4.5 crores · FY27
stated conditionally by Marshal Sonavane
p. 5
“Primarily your summer seasons would have gone, so benefit would be in the range of about INR4.5 crores is what we can expect.”
Marshal Sonavane, page 5 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management said spreads seen in Q4 appear to be continuing into Q1, driven by demand tailwinds and cotton price movements.
Answered by Marshal Sonavane
Asked by Riddhesh Ram Gandhi: Are Q1 FY27 spreads in line with or higher than Q4 average, and what is driving them?
p. 5
“So whatever spreads we have received in quarter 4, at least it seems to continue in quarter 1.”
Marshal Sonavane, page 5 of the filed PDF · View the filing
Management said they are not considering a buyback and plan to deploy remaining committed capex of about INR300-350 crores toward fabric and processing investments including PM MITRA Park.
Answered by Marshal Sonavane
Asked by Riddhesh Ram Gandhi: Given the low leverage, what is the plan for deploying free cash flow — buyback or capex?
p. 5
“We are as of now we are not looking at a buyback, but we are looking to deploy this cash what we generate”
Marshal Sonavane, page 5 of the filed PDF · View the filing
Management attributed demand tailwinds to resolution of US tariffs, the EU FTA, temporary Chinese yarn demand, and strong domestic demand, with spreads rising from INR123/kg in Q3 to INR148/kg in Q4.
Answered by Marshal Sonavane
Asked by Prerna Jhunjhunwala: What is driving demand in domestic and export markets and how have spreads moved?
p. 6
“our spread in Q3 was about INR123 per kilo, which has gone up to about INR148 kilo in Q4.”
Marshal Sonavane, page 6 of the filed PDF · View the filing
Management said Chinese demand has tapered since March and was earlier driven by low Indian yarn prices and a Chinese cotton acreage reduction.
Answered by Marshal Sonavane
Asked by Prerna Jhunjhunwala: Is Chinese demand continuing, and why did it emerge?
p. 6
“I think we have seen a tapering down on demand since March, at least in our set, of customers and channel partners.”
Marshal Sonavane, page 6 of the filed PDF · View the filing
Management explained that on an absolute basis volumes were slightly lower in Q4 versus Q3, so the per-unit spread gain does not translate proportionally into absolute gross margin improvement, and R.S. Jalan added the EBITDA increase was around 29%.
Answered by Marshal Sonavane
Asked by Saransh Gupta: Why did gross margin improvement look smaller than the increase in spreads would suggest?
p. 8
“what I can tell you that our EBITDA margins went up about 10% to 11.7%.”
Marshal Sonavane, page 8 of the filed PDF · View the filing
Management targeted fabric at around 15% of revenue for the year with a large share knitted in-house, and said 60% of yarn output will eventually be vertically integrated into fabric or processed fabric.
Answered by Marshal Sonavane
Asked by Saransh Gupta: How will fabric contribution evolve for FY27 and after full deployment of the processing investment?
p. 9
“We are targeting almost 15% of our revenue to come from fabric.”
Marshal Sonavane, page 9 of the filed PDF · View the filing
Management said they hold about 120 days of inventory as of March 31 and expect cotton purchases to taper going forward.
Answered by R. S. Jalan
Asked by Aradhana Jain: How much cotton inventory is being held given rising prices, and will it continue to build?
p. 9
“We have approximately around 120 days of inventory as on 31st of March.”
R. S. Jalan, page 9 of the filed PDF · View the filing
Management said the spread and pricing should hold for Q1 but flagged inflation and gas availability as risks to sustained pass-through.
Answered by Marshal Sonavane
Asked by Aradhana Jain: Can the improved spreads be sustainably passed through given inflationary pressure?
p. 10
“But the big risk is particularly from an inflation point of view and gas availability.”
Marshal Sonavane, page 10 of the filed PDF · View the filing
Management said they expect this year's growth to broadly continue, plus or minus 2%, contingent on geopolitical stability.
Answered by Marshal Sonavane
Asked by Rehan Saiyyed: What is the outlook for EBITDA margin over the coming quarters?
p. 10
“we expect the growth what we have delivered this year to continue. It would be near about that level, exact number, it is like plus/minus 2% delta sort of thing”
Marshal Sonavane, page 10 of the filed PDF · View the filing
Management pointed to the full-year benefit of the new spindles, knitting machine additions, solar commissioning, and product mix optimization as growth drivers.
Answered by Marshal Sonavane
Asked by Amey Chheda: Where will incremental FY27 revenue growth come from?
p. 12
“this will be the revenues for growth for FY27.”
Marshal Sonavane, page 12 of the filed PDF · View the filing
Management cited historical 15% EBITDA on current products, vertical integration into fabric, product mix optimization toward higher-margin products, and sustained high utilization as drivers.
Answered by Marshal Sonavane
Asked by Madhur Rathi: What will drive the 15%-18% EBITDA margin guidance — product mix or fabric share?
p. 13
“I think if we continue to maintain that definitely 15% to 18% margin is a within the next 3 years.”
Marshal Sonavane, page 13 of the filed PDF · View the filing
Management said pending investments of about INR350 crores in processing and fabrication, with better asset turnover, are expected to help bridge the gap to the target.
Answered by Marshal Sonavane
Asked by Varun Gajaria: What other triggers beyond the new spindles will drive revenue growth to reach the INR2,000 crore target?
p. 14
“I think those investments are going in processing and fabrication. I think these investments typically have a much better asset turnover ratio.”
Marshal Sonavane, page 14 of the filed PDF · View the filing
Management attributed the receivables increase to revenue growth and previously extended higher credit limits during a challenging period, which they expect to normalize.
Answered by Marshal Sonavane
Asked by Sagar: Why have receivables increased 43% and what is driving the drop in operating cash flow?
p. 17
“So receivable increase is primarily for two reasons. Of course, one is large part of it is because of revenue increases.”
Marshal Sonavane, page 17 of the filed PDF · View the filing
Management said working capital is elevated due to pre-emptive cotton purchases but expects it to taper toward a normal range.
Answered by Marshal Sonavane
Asked by Sagar: What is the sustainable working capital level going forward?
p. 18
“But it usually has been between 110 to 120 days for us also. And I think that is the level we are planning to maintain.”
Marshal Sonavane, page 18 of the filed PDF · View the filing
Management said they are internally targeting FY29 for revenue and possibly FY30 for both revenue and margin targets.
Answered by Marshal Sonavane
Asked by Sagar: By what year do you expect to achieve the INR2,000 crore revenue and 15%-18% EBITDA margin targets?
p. 19
“So as for our internal guidance, we are sort of aiming for FY29 at least for the top line, maybe around FY30.”
Marshal Sonavane, page 19 of the filed PDF · View the filing
Risks flagged
US-Iran conflict disrupting trade routes and raising logistics costs
p. 3
“Challenges remain in terms of on-going US-Iran conflict, which has disrupted traditional trade routes, resulting in shipment delays and elevated logistics cost.”
Marshal Sonavane, page 3 of the filed PDF · View the filing
Elevated energy and fuel prices pressuring cost economics
p. 3
“Energy markets are under pressure and higher fuel prices is weighing on the cost economics of our synthetic portfolio and fabric manufacturing.”
Marshal Sonavane, page 3 of the filed PDF · View the filing
Uncertainty over sustainability of price pass-through amid inflation and gas availability
p. 10
“So, the cost in processing and fabric making would continue to rise, whether at that cost level at which other participants in the value chain would operate at, whether the yarn prices will continue to rise, that's a big question mark.”
Marshal Sonavane, page 10 of the filed PDF · View the filing
Global geopolitical volatility affecting spreads beyond Q1
p. 5
“Beyond that, as I said it is depending on how the global geopolitical situation evolves, there could be an impact over it”
Marshal Sonavane, page 5 of the filed PDF · View the filing
Labour availability challenge across the industry
p. 7
“In terms of labour, we did not, of course that remains a challenge across the industry, but we have been able to manage our labour situation very well.”
Marshal Sonavane, page 7 of the filed PDF · View the filing
Risk from West Asia conflict and unresolved geopolitical situation
p. 16
“There is definitely a risk on the side of West Asia conflict and impact from that.”
Marshal Sonavane, page 16 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.