SPORTKING Q1 FY26 earnings call.
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Revenue
₹585.8 Cr
verification pending
Revenue YoY
—
reported change
EBITDA
₹70.5 Cr
latest reported figure
Source
manual review required
record provenance
Actual signal trajectory
Where this quarter sits.
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What the record says.
Sportking India reported Q1 FY26 revenue of INR 585.8 crore with PAT at INR 35.2 crore (+10.5% YoY). EBITDA margin expanded 40bps YoY to 12%, supported by stable cotton prices and favorable product mix. Gross margin improved to 26.8% (+254bps YoY) due to better inventory management. Export contribution rose to 38% of revenue, with Bangladesh accounting for ~60-65% of exports. Management announced a INR 1,000 crore greenfield capex in Odisha (150,000 spindles, expandable to 300,000) targeting INR 1,000-1,200 crore revenue potential with 200-300bps margin expansion. Integration of two promoter-owned manufacturing units is expected in 6-8 months, adding ~INR 200 crore revenue in year one. Key risks include US tariff uncertainty (25% on Indian goods vs. 20% on other Asian peers), rising Indian cotton prices relative to international benchmarks, and limited direct US exposure but indirect exposure through international customers. Management remains cautious on near-term visibility but committed to double-digit EBITDA margins under current circumstances.
Colored figures show movement against the previous available record.
Guidance to track
- The new 150,000-spindle spinning facility in Odisha (first phase of 300,000-spindle MoU with state government) is expected to generate INR 1,000-1,200 crore revenue. Timeline is 12-15 months for commercial production, with real benefits visible from FY28.
- Management expects overall company EBITDA margin to expand by 200-300 basis points post-completion of Odisha expansion, driven by government incentives, new technology, proximity to ports, and access to cotton surplus state of Odisha.
- Integration of two promoter-owned parallel manufacturing and dyeing units expected within 6-8 months, adding approximately INR 200 crore topline in first year with slightly better EBITDA margins than current business.
- Management targets to double garment business revenue from current INR 150-180 crore to INR 300-360 crore within 2-3 years through efficiency improvements, social compliance for exports, and targeting big buyers, with minimal capex required.
Risks flagged
- 25% tariff on Indian goods vs. 20% on other Asian players creates pricing disadvantage. While Sportking has no direct US exports, indirect exposure exists through international customers. Management expects clarity in 30-45 days and remains hopeful of amicable settlement.
- Indian cotton prices trade at a discount to international prices, further accentuated by 11% import levy. Minimum support prices and CCI inventory holding are driving domestic prices higher, putting Indian spinners at a competitive disadvantage on raw material costs.
- Bangladesh is the largest export destination (60-65% of exports). Land route movement restrictions remain in place pending elections. Management expects land route to open post-election but may take 6-8 months, potentially affecting near-term order flow.
- INR 1,000 crore expansion announced amid textile industry headwinds from geopolitical tensions and raw material cost disadvantages. Analyst raised concerns about yarn business profitability challenges and ROI expectations. Management acknowledged 5-6 year payback period under current spreads.
Key quotes
- I think these are one of the worst times for textile industry in spinning industry per se with a lot of headwinds we are facing from internally and externally... In spite of all this we are doing pretty well as we are maintaining double digit profitability for last so many quarters and we are working at almost fully utilized.
- We are expecting a revenue of around 1,000 to 1,200 crores from this new expansion... We are very optimistic about this and we are a conservative company. We took a lot of thought over last one year and then we went forward with this and we are pretty confident that this will help us in improving the overall EBITDA of our company by at least 200 to 300 basis points.
- The demand from Bangladesh continues to be good. The land route is still not working... We expect once the elections happened and the permanent government comes, we expect because even before it had happened and it took about one year for it to open so we expect it to open finally but I think it might take 6 to 8 months for that.
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