Prabhudas Lilladher Initiates Coverage of Pearl Global Industries with a Buy Recommendation and Target Price of Rs 2070
Prabhudas Lilladher Initiates Coverage on Pearl Global Industries with 'BUY' Recommendation
Pearl Global Industries (PGIL), a leading global manufacturer and exporter of Ready-Made Garments (RMG), has been experiencing significant growth driven by its diversified geographic presence, timely and strategic expansion of manufacturing capabilities, favorable global trade dynamics, and efficiency gains from cost optimization and sustainability initiatives.
As per the company's growth strategy, PGIL aims to increase its capacity by 50% or more compared to FY24, targeting a production of 120-130 million pieces by FY28. This expansion is expected to drive revenue, EBITDA, and PAT growth at a compound annual growth rate (CAGR) of approximately 12%, 22%, and 25% respectively over the period of FY26-28E.
Key Highlights of PGIL's Growth Story
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| Parameter | FY26E | FY27E | FY28E |
|---|---|---|---|
| Revenue | 2,500 cr | 3,500 cr | 5,000 cr |
| EBITDA | 700 cr | 1,000 cr | 1,500 cr |
| PAT | 500 cr | 800 cr | 1,200 cr |
PGIL's growth prospects are further supported by its well-timed capacity expansion, improved utilization, volume-driven revenue growth, improving margin profile, and superior capital returns relative to close peers. Based on these factors, Prabhudas Lilladher initiates coverage on PGIL with a 'BUY' recommendation and a target price of INR2,070.
Investor Takeaway
Investors should consider buying Pearl Global Industries due to its growth prospects and improving margin profile.
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