One of India’s largest apparel export company Gokaldas Exports Limited (GEL) is a multibagger stock in which two brokerages see an upside of up to 60%. The company designs, manufactures and sells a wide range of garments for men, women and children. It caters to the needs of leading international fashion brands and retailers.
Despite declining demand from Europe and China, the company witnessed a sharp 23% increase in its shipments in the September quarter. It focused on the US market, which is still resilient as compared to Europe and China.
It reported a consolidated total income of ₹ 576.32 crores, up 29.22% as compared to ₹ 446.00 crores in the corresponding quarter last year.
The Bengaluru-based garment exporter has delivered multibagger returns of 381.71% in the past three years. If an investor would have invested ₹ 1 lakh in the company’s shares three years ago, the value of their holdings would have been ₹ 4.82 lakhs today!
Emkay Global
Emkay Global Financial Services has a buy call on GEL’s shares with a target price of ₹ 575.00. Its shares were trading at ₹ 381.20 apiece at 03:23 PM on Thursday, and the given target implies an upside of 50.84%.
The brokerage said that the GEL is the major medium beneficiary of development in the MMF ecosystem in India. The company continues to expand its woven capacity and has entered the knitting space too, making it India’s best garments player.
ICICI Securities
ICICI Securities has a buy rating on the shares of Gokaldas exports with a target price of ₹ 560. This implies an upside of 46.90% as compared to its share price.
The brokerage said that the company under its new management has witnessed significant changes including marquee client additions, a richer product mix, higher margins and so on, leading to robust returns for shareholders.
“We believe, India – with its stable economy, abundant cotton availability, cheaper labour vs China and control over covid – is well placed to wrest a chunk of apparel market share from China and other competitive economies. Hence, India’s textile and apparel industry stands to benefit in the medium term,” it said.
Further, it said that the government of India signing of FTAs with various countries (UK FTA likely in H1CY23) and incentive schemes is likely to boost the domestic textile ecosystem and catalyse further growth.
Written by Simran Bafna
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