Gap, Zara partner PGIL sews growth with global reach, eyes ₹6,000 cr revenue by FY28

Mumbai: Pearl Global Industries Ltd (PGIL), one of India’s largest listed garment exporters, has maintained its growth momentum into the new fiscal year, having reported a 16.6% rise in consolidated revenue to ₹1,228 crore for the quarter ended June (Q1FY26). This marks the fifth consecutive quarter above the ₹1,000-crore threshold for the firm that has facilities in five countries and serves top global retailers such as Gap, Zara, Muji, Primark and Ralph Lauren.

PGIL’s adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) rose 13.4% year-on-year (y-o-y) to ₹114 crore with a margin of 9.3%. After adjusting for operational losses at new units in Guatemala and Bihar, its margins were at 10.7%, sustaining the double-digit trend for the second straight quarter, the company said. Net profit came in at ₹66 crore, up 5.9% y-o-y.

PGIL’s performance was led by strong volume growth in Vietnam and Indonesia, which together contributed significantly to shipment volumes of 17.2 million pieces in Q1, up from 16.7 million a year ago. These markets are now emerging as key manufacturing hubs alongside Bangladesh, which continues to be PGIL’s largest operating geography.

Strategic shift

Since taking charge in 2019, managing director Pallab Banerjee has overseen a strategic shift from a largely India-dependent exporter to a multi-country manufacturing platform. PGIL now operates in five countries—India, Bangladesh, Vietnam, Indonesia and Guatemala—allowing it to diversify labour costs, trade exposure and customer servicing capabilities.

The company’s topline grew from around ₹2,800 crore in FY20 to ₹4,506 crore in FY25. It now targets ₹6,000 crore revenue and 10-12% EBITDA margin by FY28, supported by capacity expansion from 100 million to 135 million pieces.

The company’s new units in Bihar and Guatemala, launched last year, are still in the scale-up phase. The company plans further investment in Bangladesh to support long-term growth.

Despite the ongoing capital expenditure, PGIL remains net cash positive. It ended FY25 with ₹172 crore in cash and raised ₹149.5 crore through a QIP in July 2024, using over ₹97 crore to retire debt. Long-term borrowing is rated ‘A’ (Stable) by ICRA.

The company declared a dividend of ₹18 crore from subsidiaries in Bangladesh and Hong Kong in Q1, marking continued cash flow fungibility across the group. Standalone India revenue for the quarter came in at ₹267 crore, down 3.4%, with margins improving due to product and customer mix changes.

While the company’s revenue concentration from the US market has come down, its client diversification continues to improve, Banerjee said. PGIL added new customers in Japan, the UK, Denmark and Spain in FY25 and services a base of over 50 global fashion retailers.

Its top five clients contribute 60–65% of the overall business, but span multiple geographies and categories.

Analysts say PGIL’s strength lies in its geographic insulation, multi-product capability and shift to value-added categories like outerwear and activewear. “PGIL has evolved into a global supply-chain partner with operations across five countries,” said Bhavya Gandhi, analyst at Dalal & Broacha.

The company has consciously focused on increasing the share of its high-margin categories. Jackets and outerwear now account for over 40% of volume and 50% of revenue. Categories like woven bottoms and knits are also seeing traction.

Improved margins

Margins have improved from under 5% in FY19 to over 9.5% in FY25. The company aims to sustain margins in the double-digit range by focusing on premium products, better capacity utilisation and design-led value addition.

“PGIL is no longer seen as a low-margin, high-volume player,” Gandhi said. “Its repositioning as a full-service global partner puts it in a stronger place for the next phase of growth.”

Banerjee said the company continues to invest in operational efficiencies, including sustainable processing, automated design sampling and smart manufacturing practices across units. These help control costs while meeting growing client compliance requirements on ESG.

PGIL’s growth strategy also includes de-risking of its sourcing. Vietnam and Indonesia have seen higher customer interest, while Guatemala provides near-shore capabilities for the Americas. India, meanwhile, continues to benefit from trade pacts with the UK, Japan and Australia.

Commenting on the quarter’s results, Banerjee said, “We are witnessing healthy growth in Vietnam and Indonesia and continue to see momentum across our diversified geographies. We are confident in our strategy and execution, and our FY28 targets remain on track.”

With its multi-country footprint, improved margin profile and steady institutional interest post-qualified institutional placement (QIP) of shares , PGIL is positioning itself as a redefined, high-growth garment exporter—balancing cost agility, category premiumisation and long-term client partnerships.