Vardhman Textiles

Vardhman Textiles reported a decent Q4 FY26 performance, with gross margins expanding ~300bps QoQ, though EBITDA margins were impacted by a one-time mark-to-market forex loss of ~₹57-58 crore. The key positive is a structural turnaround in the spinning industry: ~11-12 million spindles have permanently shut, reducing effective capacity to 41-42 million spindlesCurrent 41-42 million spindles. Reported change: -18M spindles vs potential. from a potential 59-60 million. Simultaneously, demand has surged—China's monthly yarn imports from India jumped from 7-8 million kgCurrent reported value: 7-8 million kg. No comparable prior figure is available in the source record. to 30 million kgCurrent 30 million kg. Reported change: +23M kg vs normal 7-8M kg., and US tariffs removal has boosted home textile exports to near-full utilization. Cotton prices have aligned globally, with spreads improving from 60-65 centsCurrent reported value: 60-65 cents. No comparable prior figure is available in the source record. to 90-95 centsCurrent 90-95 cents. Reported change: +50% vs 60-65 cents low. per kg. Management expects Q1 FY27 to be significantly better as fabric price hikes lag and the forex loss reverses. Risk: Sustainability of current spreads depends on cotton prices and China demand; any reversal could pressure margins.