PDS Ltd — Q4 FY26 earnings call
Summary generated by AI from the official transcript PDS Ltd filed with BSE on 22 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
PDS Limited reported FY26 GMV growth of 5% to approximately ₹19,666 crores and revenue growth of 4% to ₹13,110 crores, with gross margins improving 48 basis points to 20.6%. EBITDA declined to ₹385 crores from ₹457 crores last year, while PAT fell to ₹178 crores from ₹241 crores, though Q4 PAT rose sharply quarter-on-quarter. Management highlighted a reduction in net debt to about ₹105 crores, net working capital days falling to about 4 days, and an order book of ₹5,074 crores as of early April reflecting roughly 11% growth, with North America order book up close to 30%.
Numbers mentioned
GMV: approximately ₹19,666 crores (FY 2026)
p. 3
“we delivered GMV growth of 5% to approximately ₹19,666 crores and a revenue growth of 4% to ₹13,110 for FY 2026”
Sanjay Jain, page 3 of the filed PDF · View the filing
Revenue: ₹13,110 crores (FY 2026)
p. 3
“we delivered GMV growth of 5% to approximately ₹19,666 crores and a revenue growth of 4% to ₹13,110 for FY 2026”
Sanjay Jain, page 3 of the filed PDF · View the filing
Order book: ₹5,074 crores (as of early April FY 2027)
p. 3
“our order book as of early April stood at about ₹5,074 crores, reflecting a growth of approximately 11% and thereby providing an encouraging visibility into FY 2027”
Sanjay Jain, page 3 of the filed PDF · View the filing
Net working capital days: about 4 days (FY 2026)
p. 4
“the net working capital days reduced from about 17 days, 1 year back to about 4 days at the end of FY 2026”
Sanjay Jain, page 4 of the filed PDF · View the filing
Operating cash flow: approximately ₹781 crores (FY 2026)
p. 4
“Business generated operating cash flow of approximately ₹781 crores during the year and net debt reduced from about ₹374 crores 1 year back to close to ₹100 crores”
Sanjay Jain, page 4 of the filed PDF · View the filing
Net debt: close to ₹100 crores (FY 2026)
p. 4
“Business generated operating cash flow of approximately ₹781 crores during the year and net debt reduced from about ₹374 crores 1 year back to close to ₹100 crores”
Sanjay Jain, page 4 of the filed PDF · View the filing
Gross margin: 20.6% (FY 2026)
p. 5
“gross margins for FY 2026 improved by 48 basis points to 20.6%, supported by procurement efficiencies, disciplined sourcing and some one-off opportunities in Q3”
Sadik Sunasara, page 5 of the filed PDF · View the filing
EBITDA: ₹385 crores (FY 2026)
p. 5
“EBITDA for the year was ₹385 crores versus ₹457 crores last year”
Sadik Sunasara, page 5 of the filed PDF · View the filing
Other income: ₹99.7 crores (FY 2026)
p. 5
“Other income almost doubled to ₹99.7 crores in FY 2026, primarily driven by FX gains and mark-to-market gains of around ₹19 crores on PDS venture investments”
Sadik Sunasara, page 5 of the filed PDF · View the filing
Finance costs: ₹146.5 crores (FY 2026)
p. 5
“Finance costs for the full year was ₹146.5 crores, higher by about 16% compared to last year”
Sadik Sunasara, page 5 of the filed PDF · View the filing
Effective tax rate: 13.5% (FY 2026)
p. 5
“Effective tax rate for FY 2026 was 13.5% compared to 10.1% in FY 2025”
Sadik Sunasara, page 5 of the filed PDF · View the filing
PAT: ₹178 crores (FY 2026)
p. 6
“PAT for the year was ₹178 crores versus ₹241 crores in FY 2025”
Sadik Sunasara, page 6 of the filed PDF · View the filing
Q4 PAT: ₹72 crores (Q4 FY 2026)
p. 6
“Q4 PAT increasing almost 95% quarter-on-quarter to ₹72 crores compared to ₹37 crores in Q3, driven by improved operating leverage tighter control on operating costs and moderation in finance costs”
Sadik Sunasara, page 6 of the filed PDF · View the filing
Sourcing segment revenue: approximately ₹12,399 crores (FY 2026)
p. 6
“the sourcing business remained resilient, contributing revenues of approximately ₹12,399 crores with EBIT of ₹266 crores”
Sadik Sunasara, page 6 of the filed PDF · View the filing
Manufacturing segment revenue: approximately ₹1,034 crores (FY 2026)
p. 6
“The Manufacturing segment also delivered strong performance during FY 2026, with revenues growing 31% year-on-year to approximately ₹1,034 crores and EBIT increasing to ₹57 crores, translating into EBIT margins of approximately 5.5%”
Sadik Sunasara, page 6 of the filed PDF · View the filing
Net debt-to-EBITDA: around 0.27 (FY 2026)
p. 6
“Our leverage ratios remain comfortable with net debt-to-EBITDA at around 0.27 and normalized return on capital employed at approximately 25%, reflecting improving capital efficiency and stronger balance sheet quality”
Sadik Sunasara, page 6 of the filed PDF · View the filing
Dividend payout: ₹3.3 per share (FY 2026)
p. 6
“I am pleased to share that we have proposed a dividend payout ₹3.3 per share, of which ₹1.65 per share was paid as interim dividend amounting to around 42% of FY 2026 PAT, maintaining our capital return track record”
Sadik Sunasara, page 6 of the filed PDF · View the filing
New Lobster income from operations: approximately ₹500 crores (FY 2026)
p. 15
“we had for the entire year, income from operations of approximately ₹500 crores and similar period last year was about ₹480-odd crores”
Sanjay Jain, page 15 of the filed PDF · View the filing
Employee costs: ₹1,317 crores (FY 2026)
p. 15
“I think our employee cost last year was circa ₹1,211 crores. This year has been about ₹1,317 crores”
Sanjay Jain, page 15 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.
Gross margin — 40 to 50 basis points improvement · next 1-2 years
stated conditionally by Sanjay Jain
p. 7
“we are anticipating an average 40 to 50 basis point improvement in the gross margin in the next 1 or 2 years, every year”
Sanjay Jain, page 7 of the filed PDF · View the filing
EBITDA margin — 50 to 75 basis points improvement · current year
stated as an aspiration by Sanjay Jain
p. 7
“I think slightly more than that 50 to 75 basis point we are targeting that it should reflect in terms of improvement in the EBITDA margins for the current year”
Sanjay Jain, page 7 of the filed PDF · View the filing
Working capital days — current levels · FY 2027
stated firmly by Sanjay Jain
p. 7
“Our endeavor throughout the year would be to try and keep it at current levels”
Sanjay Jain, page 7 of the filed PDF · View the filing
Top 10 client growth — 7-8% · FY 2027
stated as an aspiration by Sanjay Jain
p. 8
“across our top 10 clients, we should see growth more in the vicinity of about 7-8%, slightly lower than the average”
Sanjay Jain, page 8 of the filed PDF · View the filing
Revenue growth — mid-single-digit · FY 2027
stated conditionally by Sanjay Jain
p. 9
“we're maintaining mid-single- digit growth outlook for the current year and then close to about 10% or so plus broad growth in the profits”
Sanjay Jain, page 9 of the filed PDF · View the filing
Opex growth vs revenue growth — slower than top line growth · FY 2027
stated firmly by Sanjay Jain
p. 9
“the growth in the employee costs and other expenses should not exceed our overall growth in the top line”
Sanjay Jain, page 9 of the filed PDF · View the filing
New vertical investment — ₹80 crores · FY 2027
stated conditionally by Sanjay Jain
p. 13
“we had said we will be able to bring it down to about ₹80 crores in FY 2027. We remain positive that we will be able to bring it to ₹80 crores, beyond that ₹50 crores to ₹60 crores every year is going to be a recurring investment”
Sanjay Jain, page 13 of the filed PDF · View the filing
Revenue growth — mid-teens · medium to long term
stated as an aspiration by Sanjay Jain
p. 11
“medium to long term mid-teens growth that we've also historically achieved in the past, we are very positive that, that is very much doable”
Sanjay Jain, page 11 of the filed PDF · View the filing
New vertical investments — no new investments · next 12 months
stated firmly by Pallak Seth
p. 10
“we have not initiated any new verticals or made investments in new businesses, and we expect to maintain a similar approach with no new investments over the next 12 months”
Pallak Seth, page 10 of the filed PDF · View the filing
Simple Approach and Krayons growth — H1 FY 2027
stated as an aspiration by Sanjay Jain
p. 14
“these two, we are very positive that in H1 itself, you should see them posting both top line growth as well as profitability growth”
Sanjay Jain, page 14 of the filed PDF · View the filing
Sourcing as a service contract with U.S. retailer — scale beyond approximately ₹475 crores
stated as an aspiration by Sanjay Jain
p. 3
“A key milestone during the year was securing the new sourcing as a service mandate with a leading U.S. value retailer with a relationship, having the potential to scale beyond approximately ₹475 crores over a period of time”
Sanjay Jain, page 3 of the filed PDF · View the filing
New Lobster financial contribution from ABG — extend contribution for 24 months · after 12-month period
stated conditionally by Pallak Seth
p. 16
“we are asking them to extend it for another 24 months after the 12-month period is over or replace that with additional turnover coming to a new appointed retail franchise partner”
Pallak Seth, page 16 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 guided to 40-50 bps gross margin improvement annually and slightly higher EBITDA margin improvement.
Answered by Sanjay Jain
Asked by Hitaindra Pradhan: What is the outlook for gross margin and EBITDA margin this year?
p. 7
“we are anticipating an average 40 to 50 basis point improvement in the gross margin in the next 1 or 2 years, every year”
Sanjay Jain, page 7 of the filed PDF · View the filing
Management said royalty obligations and provisions for shut-down businesses inflated costs, and these one-offs should fade as top line grows.
Answered by Sanjay Jain
Asked by Hitaindra Pradhan: What will drive efficiency gains in other expenses?
p. 7
“as our top line traction build up, as these one-offs go away, you should see efficiency of that coming in as well”
Sanjay Jain, page 7 of the filed PDF · View the filing
Management attributed it to one-time redundancy costs from BCG-led efficiency initiatives and expects a rebound.
Answered by Sanjay Jain
Asked by Samvit Patel: What caused margin erosion at Poeticgem and Simple Approach?
p. 8
“what you see here is more an impact of the onetime redundancies than anything else”
Sanjay Jain, page 8 of the filed PDF · View the filing
Management confirmed the U.S. business returned to profitability in Q4.
Answered by Sanjay Jain
Asked by Rohit: What happened with U.S. business profitability in Q4 versus nine months?
p. 9
“the U.S. business did make more money in the fourth quarter. It is back in the black for sure. I think the business, as we had anticipated, it is PBT positive for fourth quarter, yes”
Sanjay Jain, page 9 of the filed PDF · View the filing
Management explained retailers source significantly through third parties and PDS offers four service lines including manufacturing, design-led sourcing and sourcing-as-a-service.
Answered by Pallak Seth
Asked by Vinod Krishna: Why can PDS scale with large retailers like Walmart that won't shut down their own procurement?
p. 11
“approximately 15% to 20% of their sourcing is from their sourcing offices currently. 70% to 80% is through third-party”
Pallak Seth, page 11 of the filed PDF · View the filing
Management described brand business challenges tied to Ted Baker franchisee bankruptcies and said new vertical investment would be curtailed to ₹80 crores in FY27.
Answered by Sanjay Jain
Asked by Madhur Rathi: Why did PDS enter the brands business given low market share, and when will losses turn to breakeven?
p. 13
“we had said we will be able to bring it down to about ₹80 crores in FY 2027”
Sanjay Jain, page 13 of the filed PDF · View the filing
Management said Simple Approach's H2 was an aberration, Krayon faced U.S. tariff turbulence, and Klieder may take longer to recover growth.
Answered by Sanjay Jain
Asked by Kiran Gadge: What were H2 declines in Simple Approach, Krayon's, and Klieder verticals due to?
p. 14
“Krayon is largely serving the U.S. markets. And there have been, as you know, the turbulence due to the tariff impact and otherwise”
Sanjay Jain, page 14 of the filed PDF · View the filing
Management gave income from operations of approximately ₹500 crores with PAT increasing to about ₹38 crores despite a gross margin decline.
Answered by Sanjay Jain
Asked by Rudraksh Raheja: What were New Lobster's revenue and PAT for FY26?
p. 15
“The profit after tax of the business, which was circa ₹₹13-odd crores last year, has actually increased this year to almost about ₹38-odd crores or so”
Sanjay Jain, page 15 of the filed PDF · View the filing
Pallak Seth explained ongoing discussions with ABG on financial contributions and finding new retail partners for Ted Baker.
Answered by Pallak Seth
Asked by Rudraksh Raheja: What is the New Lobster turnaround initiative highlighted in the presentation?
p. 16
“we are in close discussion with ABG, the brand owner and discussing with them either they have to give PDS financial contribution every year for us to be able to maintain and run the head office of the business”
Pallak Seth, page 16 of the filed PDF · View the filing
Management cited customer caution on inventory buildup and shipment pushbacks despite strong order books.
Answered by Sanjay Jain
Asked by Dhwanil Desai: Why is order book growth of 11% not translating to higher revenue growth guidance?
p. 17
“there has been a push back. The customers have been cautious on inventory buildup as well is this caution that is kind of holding us back”
Sanjay Jain, page 17 of the filed PDF · View the filing
Management said they remain cautious given global headwinds despite the math suggesting higher flow-through.
Answered by Sanjay Jain
Asked by Dhwanil Desai: Why isn't projected margin and cost improvement translating into higher PAT growth guidance?
p. 17
“We need to be prepared for the global headwinds that are there. So that's where we are coming from”
Sanjay Jain, page 17 of the filed PDF · View the filing
Risks flagged
Cautious consumer sentiment and evolving trade dynamics affecting apparel supply chains
p. 3
“The operating environment remained very challenging throughout the year, shaped by cautious consumer sentiment, the evolving trade dynamics, we ramped geopolitical disruptions and the continued inventory discipline across global retailers and brands”
Sanjay Jain, page 3 of the filed PDF · View the filing
Customer caution with shorter order cycles and selective order deferments
p. 4
“customers continue to remain cautious with shorter order cycles and selective order deferments in certain regions”
Sanjay Jain, page 4 of the filed PDF · View the filing
Impairment taken on DBS lifestyle vertical investment
p. 5
“At India stand-alone level, we have taken an impairment of about ₹14 crores on investment in DBS lifestyle vertical”
Sadik Sunasara, page 5 of the filed PDF · View the filing
Ted Baker retail franchisee bankruptcies impacting New Lobster business
p. 13
“It is when these retail franchisees went into administration that the agency sales of New Lobster to Ted Baker got impacted”
Sanjay Jain, page 13 of the filed PDF · View the filing
Tariff impact on U.S.-facing Krayons vertical
p. 14
“there have been, as you know, the turbulence due to the tariff impact and otherwise”
Sanjay Jain, page 14 of the filed PDF · View the filing
Global macroeconomic and geopolitical uncertainties entering FY 2027
p. 5
“we continue to remain mindful of ongoing macroeconomic and geopolitical uncertainties”
Sanjay Jain, page 5 of the filed PDF · View the filing
Brand wholesale business more challenged, requiring portfolio rationalization
p. 10
“the entire brand business because the brand wholesale business is more challenged”
Pallak Seth, page 10 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.