Arvind (500101) Q1 26/27 earnings summary

Executive summary

• Q1 FY27 began with strong momentum, achieving record consolidated revenue of ₹2,501 Cr and EBITDA of ₹258 Cr, up 25% and 39% year-over-year, respectively, driven by robust demand across core businesses and the Dalco-GFT acquisition.

• Strategic initiatives included expanding global presence with a London office and partnerships in Bangladesh and Egypt, and the acquisition of Dalco-GFT (USA) for $136M, the largest to date, strengthening the technical textile platform.

• Garmenting volumes crossed 11 million pieces for the first time, up 13% year-over-year, supported by verticalization and robust demand.

• Successfully completed a ₹500 Cr QIP, oversubscribed and used primarily for debt reduction, attracting marquee institutional investors.

• Advanced Materials Business (AMB) posted its highest-ever quarterly revenue and EBITDA, with margins at 15%, and expanded its defense and paramilitary customer base.

Financial highlights

• Consolidated revenue reached ₹2,501 Cr, up 25% YoY; EBITDA grew 39% to ₹258 Cr; PAT before exceptional items was ₹80 Cr, up 47% YoY.

• EBITDA margin improved to 10.3% from 9.3% YoY, driven by operating leverage and improved business mix.

• Textile division revenue was ₹1,735 Cr (+13% YoY); garmenting revenue ₹497 Cr; AMB revenue ₹650 Cr (up 85% YoY), EBITDA ₹97 Cr (up 115% YoY), margin 15%.

• Dalco-GFT contributed ₹157 Cr revenue and ₹24 Cr EBITDA for 1.8 months post-acquisition.

• Net debt increased to ₹2,158 Cr post-acquisition, but expected to reduce by ₹500 Cr with QIP proceeds.

Outlook and guidance

• Demand remains resilient across Textiles and AMB, with healthy order books and sustained customer engagement; UK-India FTA and improving domestic demand expected to drive incremental growth.

• Textile margins expected to recover as raw material price escalations are gradually passed through; margin normalization anticipated as market adjusts.

• Garmenting margins expected to reach double digits in 18-24 months as new capacities scale up.

• AMB India business targets 18-20% revenue growth for the year, with margin improvement from operational efficiencies.

• Growth capex projects on track, with planned investments of ₹450-500 Cr for FY27.