Gokaldas Exports, backed by ex. Blackstone India head Mathew Cyriac, has successfully closed its share sale, with marquee institutional investors such as SBI Mutual Fund, Nippon Mutual Fund, Goldman Sachs Asset Management, HSBC Asset Management and Tata Mutual Fund subscribing to shares in the QIP.
The company had launched the QIP offering on October 4 at a floor price of Rs194.58 apiece.
On Thursday, shares of Gokaldas were closed at Rs.208.09 on BSE.
Originally promoted by the Hinduja family in 1978, and incorporated as a public limited company in 2004, Gokaldas Exports is one of the largest apparel exporters from India.
The US fund Blackstone took control of Gokaldas Exports in August 2007, by purchasing a majority stake in the company. Later in 2017, Clear Wealth Consultancy Services LLP, led by Mathew Cyriac, acquired a 39.94% stake in the company from Blackstone. At present, Clear Wealth Consultancy Services owns 32.53% stake in the company.
After the buyout by Clear Wealth Consultancy, Sivaramakrishnan Ganapathi, former COO at Idea Cellular, was hired as the MD and CEO, in October 2017. Revenues have grown at a 15% CAGR in FY18 to FY20 and net debt has reduced from Rs.310 crore to Rs.170 crore. It posted a revenue of Rs1209 crore in FY21 with a net profit of Rs26 crore.
Gokaldas counts amongst its customers some of the largest international brands in clothing and fashion such as GAP, Banana Republic, Columbia, H&M, Carhartt, Marks and Spencer, Old Navy, Abercrombie & Fitch, Puma and Adidas.
The volume offtake has remained steady over the years as these brands enjoy healthy value share in their respective markets, said a recent ICRA report. The expected shift in sourcing by large retailers from the competing supplier nations to India because of cost and quality factors are likely to support the long-term revenue growth potential of the company, it added.
Gokaldas is targeting to double its revenue by FY25. The company is investing Rs.120 crore over the next two years to expand capacities.
The company has started a new unit in Tumkur, Karnataka and is in the process of setting up a greenfield capacity at Bhopal, MadhyaPradesh. On achievement of full ramp up and productivity, the unit will contribute about 4.5% of the current capacity, the company said.
The company is also evaluating expansion in low-cost apparel manufacturing regions such as Bangladesh, where it will start operation by contracting out orders before setting up its own units.
The Indian textile industry has been experiencing tailwinds as global buyers slowly move away from China and look towards India to diversify their vendor base. Government incentives – a Rs.10,683 crore Production Linked Incentive (PLI) scheme and Return of Duties and Taxes on Exported Products (RODTEP) to the extent of 3.5% to 4.3% of export revenues, will boost textile exports. India’s textile and apparel exports stood at $40 billion in FY19 and projected to grow at a pace of 12% CAGR to $70 billion by FY26.
