Any current/future new fundraising through debt or equity?

The company is looking to raise equity to support the expansion of its retail division. Until the equity raise is completed, the retail division plans to grow at around 20% to maintain EBITDA breakeven and manage working capital. There is no explicit mention of any current or future planned fundraising through debt in the transcript. The focus on equity fundraising appears aimed at scaling the retail business and supporting growth initiatives.

Any current/future capex/capital investment/strategic investment?

For FY25, SP Apparels Limited's Capex incurred over 9 months is approximately INR 70 crores. For FY26, including the addition of capacities in Sri Lanka, expected Capex is higher, around INR 70-80 crores. Sri Lanka operations currently involve a job work model; if own factories are set up, investment metrics will change. Plans to invest in Sri Lanka include adding about 1,000 machines with an investment of around INR 50-75 crores. The company aims to expand garment manufacturing capacity by adding machines, targeting 2,000 more machines over two years. There is an active plan to acquire factor

Future growth expectations in sales/revenue/volumes?

Group revenue expected to reach around INR 1,600 crores in the next financial year. Standalone garment business targeting 15% to 20% top-line growth over the next 2 years. Young Brand Apparel (YBAPL) expected to grow from current INR ~310-350 crores to INR 400 crores at full capacity in 2-3 years. Sri Lanka operations planned to add capacity of around 2,000 machines over 2 years to support growth. Overall capacity expansion: aiming to run 7,000 machines by FY27 (including India and Sri Lanka). SPUK retail is growing with new customers; expecting a robust FY26. Retail division targeting profita

Future growth expectations in earnings/operating earnings/profits/EPS?

**Revenue Growth**: Company expects 15% to 20% growth in top-line revenue over the next 2 years, primarily from standalone garment business and Sri Lanka operations. **EBITDA Margins**: - Garment division targeted EBITDA margin around 18%. - SPUK expected to maintain EBITDA around 4-5%. - Retail division aiming for flat EBITDA, currently near breakeven and expected to improve profitability by FY26. **Young Brand Apparel (YBA)**: Projected revenue around INR350 crores in FY26 with 15% EBITDA margins; potential to reach INR400 crores over 2-3 years with margin improvements as cap

Current/ Expected Orderbook/ Pending Orders?

Young Brand Apparel (YBAPL) order book is around INR 85 crores. The business expects strong demand driven by customers shifting production away from Bangladesh due to political instability, with India and Sri Lanka as preferred alternatives. SPUK's current order book is valued at GBP 3.2 million. The company is actively adding new customers, with SPUK having secured 2 new customers and 2 more potential customers in discussion. The Sri Lankan operations are ramping up, with about 300 machines currently running, expected to reach 800 machines from August onwards, indicating growing produ

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S P Apparels LtdQ4 FY26Textiles & Apparels

S P Apparels Ltd Q4 FY26 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹1,038P/E: 17.3Market Cap: ₹2.0K CrSector: Textiles & Apparels

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

Yes

Order

Yes

Capex

Yes

3 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 3

→Group revenue expected to reach around INR 1,600 crores in the next financial year.
→Standalone garment business targeting 15% to 20% top-line growth over the next 2 years.
→Young Brand Apparel (YBAPL) expected to grow from current INR ~310-350 crores to INR 400 crores at full capacity in 2-3 years.
→Sri Lanka operations planned to add capacity of around 2,000 machines over 2 years to support growth.
→Overall capacity expansion: aiming to run 7,000 machines by FY27 (including India and Sri Lanka).
→SPUK retail is growing with new customers; expecting a robust FY26.
→Retail division targeting profitability for FY26, with ongoing expansion and equity fundraising.
→Company optimistic about volume and value growth supported by efficiency improvements and capacity additions.

Margin guidance

Category 3

→**Revenue Growth**: Company expects 15% to 20% growth in top-line revenue over the next 2 years, primarily from standalone garment business and Sri Lanka operations.
→**EBITDA Margins**:
→ - Garment division targeted EBITDA margin around 18%.
→ - SPUK expected to maintain EBITDA around 4-5%.
→ - Retail division aiming for flat EBITDA, currently near breakeven and expected to improve profitability by FY26.
→**Young Brand Apparel (YBA)**: Projected revenue around INR350 crores in FY26 with 15% EBITDA margins; potential to reach INR400 crores over 2-3 years with margin improvements as capacity utilization increases.
→**Capex**: Around INR70-80 crores planned for FY26 including Sri Lanka capacity addition.
→**EPS**: Current EPS stands at INR7.2 (standalone Q3 FY25). Operating efficiencies and growth should support EPS growth, though explicit future EPS guidance isn't provided.
→**Strategic Outlook**: Confidence expressed in margin improvements and sustained earnings growth driven by capacity expansion, efficiency, and geographic diversification.

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Fundraise plans

Yes

→The company is looking to raise equity to support the expansion of its retail division.
→Until the equity raise is completed, the retail division plans to grow at around 20% to maintain EBITDA breakeven and manage working capital.
→There is no explicit mention of any current or future planned fundraising through debt in the transcript.
→The focus on equity fundraising appears aimed at scaling the retail business and supporting growth initiatives.

Order book

Yes

→Young Brand Apparel (YBAPL) order book is around INR 85 crores.
→The business expects strong demand driven by customers shifting production away from Bangladesh due to political instability, with India and Sri Lanka as preferred alternatives.
→SPUK's current order book is valued at GBP 3.2 million.
→The company is actively adding new customers, with SPUK having secured 2 new customers and 2 more potential customers in discussion.
→The Sri Lankan operations are ramping up, with about 300 machines currently running, expected to reach 800 machines from August onwards, indicating growing production orders.
→Customer demand is robust, and existing customers have consented to increasing orders for Sri Lankan production, reducing risk of underutilized capacity.

Capex plans

Yes

→For FY25, SP Apparels Limited's Capex incurred over 9 months is approximately INR 70 crores.
→For FY26, including the addition of capacities in Sri Lanka, expected Capex is higher, around INR 70-80 crores.
→Sri Lanka operations currently involve a job work model; if own factories are set up, investment metrics will change.
→Plans to invest in Sri Lanka include adding about 1,000 machines with an investment of around INR 50-75 crores.
→The company aims to expand garment manufacturing capacity by adding machines, targeting 2,000 more machines over two years.
→There is an active plan to acquire factories in Tamil Nadu to expand existing capacities.
→Focus on moving operations away from Tirupur cluster to rural areas for fresh workforce and training.
→Expansion plans await equity raising to scale faster; currently aiming for 15-20% growth with controlled investment.

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