Maintaining their upward momentum, Gokaldas Exports shares surged by 12% in the early trading hours of Wednesday, reaching an all-time high of ₹817.70 per share. This surge follows the stock hitting 20% upper circuit limit in the previous trading session as investors cheered the company's expansion plans.
In a filing submitted to the exchange on Monday, the company said it had entered into an agreement through its wholly owned subsidiary Gokaldas Exports FZCO to acquire Atraco Group, a leading apparel manufacturer with operations established in Dubai since 1986.
It produces a wide range of products but specialises in the production of casual wear, including shorts, pants, shirts, blouses, t-shirts, and dresses. The group’s turnover was AED 394 million in the calendar year 2022.
In parallel, another subsidiary of Gokaldas Exports, Nava Apparels, has also entered into an agreement to acquire Coral Investments Limited. Coral currently owns Ashton Apparel, which is a manufacturer and exporter of men's, women's, and children's casual and associated products. AAM’s turnover was ETB 190 million in the calendar year 2022, the company said in a regulatory filing.
Gokaldas Exports is one of India’s largest integrated apparel manufacturers, with a manufacturing capacity of 36 million pieces per annum. It exports to some of the world's most prestigious fashion brands and retailers in more than 50 countries.
After a management change in FY2018, the company has transformed itself into one of the strongest partners for global retailers by improving on-time delivery to customers, augmenting the supply chain of key inputs, expanding capacities, and increasing the focus on product quality, which helped lower rejections by 1.5%, according to analysts.
Over the last three years, the shares have spiked from 55 to ₹791.85, generating a return of 1339%. Further, the stock has consistently delivered remarkable gains over the last four years.
In the year 2023, it has already provided a stellar return of 116.41%. Similarly, in the previous year, the stock delivered a decent return of 12.66%, and in the year before that, it recorded a substantial rally of 262%. In CY20, it rewarded shareholders with 24% gains.
Anticipating the road ahead, the global apparel market paints a promising picture. The global apparel market encompasses a diverse range of clothing, spanning from sportswear to fashion to casual to business attire, catering to various preferences and styles. In 2022, the market’s revenue reached a remarkable sum of $1.71 trillion, with a promising projection of surpassing the $2 trillion mark by 2027 and continuing to soar beyond in 2030.
The growth trajectory is driven by several key factors, including China’s anticipated ascent as the largest retail apparel market by 2025, closely followed by the United States and the EU-27. Notably, India is spearheading this growth, with its robust economy propelling the market forward at a notable rate of 10%, according to the company's FY23 annual report.
7 analysts polled by MintGenie on average have a 'strong buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.