Textile and Garment Stocks Rally; Kitex, Trident, Gokaldas Gain Up to 18%

Earnings Diverge, but Textile Stocks Find Fresh Buying

Strong results at Kitex Garments and Welspun Living helped lift sentiment, while Trident’s gains came alongside a more mixed operating picture.

Results sparked the rally, with trading volumes surging

Kitex Garments shares jumped 18% to ₹136.95, with combined trading of 13.8 million shares on the NSE and BSE—about 6.9% of its total equity. Average volume at the counter rose more than tenfold. Trident advanced 13% to ₹25.18, with 204.32 million shares changing hands, equivalent to 4% of its equity. The volume points to unusually active trading, though it does not by itself establish whether investors were buying for longer-term reasons.

Welspun Living touched a new high of ₹254.40 as average volume doubled, while Gokaldas Exports and Indo Count Industries rose 5% and 4%, respectively. The BSE Sensex was up 1.1% at 76,543 at 12:40 PM. Kitex and Trident had hit 52-week lows in October 2026; both had since recovered by as much as 25% from their October lows. That rebound adds context to the sharp moves, but does not alone indicate how durable the recovery will be.

Kitex returns to profit on faster revenue growth

Kitex reported a net profit of ₹13.71 crore in Q2FY27, compared with a loss of ₹6.22 crore a year earlier. Revenue from operations rose 66% year on year to ₹203.03 crore from ₹122.10 crore. The combination of a return to profit and sharp top-line growth helps explain why the results drew attention. Investors will need to assess whether this pace of revenue growth and the improved profitability can be sustained in subsequent quarters; the reported quarter alone cannot settle that question.

Trident’s margin gains offset a softer revenue line

Trident’s Q2FY27 revenue fell 3.8% year on year to ₹1,720 crore. Its home-textile portfolio declined 10.4%, led by bath linen, while bed linen and paper reported robust growth and yarn maintained strong momentum. Gross margin expanded 660 basis points and EBITDA margin widened 612 basis points, supported by higher cotton-yarn spreads. The quarter therefore presents a mixed signal: improved margins alongside weaker revenue, with performance varying across product lines.

The board approved ₹4,650 crore of capital expenditure for expansion and modernisation, including additional spindle capacity, sheeting looms, greater paper capacity and a renewable-energy plant. Motilal Oswal expects revenue to grow at a 7.3% CAGR over FY26-28 and margins to improve gradually towards 14.2% by FY28, citing bed linen, yarn, paper and vertical-integration benefits. These are brokerage estimates, not assured outcomes; delivery will depend on the planned investments and the business translating capacity into demand and earnings.

Welspun’s outlook hinges on growth and margin delivery

Welspun Living reported 16.9% year-on-year revenue growth and an EBITDA margin of 12.9%. Flooding in Vapi capped revenue growth, while margins remained resilient sequentially despite cotton inflation. Jefferies said the impact should reverse in coming quarters and pointed to stable US tariffs, the India-UK free trade agreement, and growth in Flooring and Pillows as potential supports. It expects scale benefits to help offset cotton inflation, while the company’s stated FY27 aim is double-digit revenue growth and a low-teens EBITDA margin.

Jefferies has a Buy rating and a ₹260 target price on the stock, and forecasts revenue, EBITDA and profit-after-tax CAGRs of 14%, 38% and 71%, respectively, over FY26-29E. Those projections depend on export demand, the US pillow ramp-up, domestic and branded growth, and recovery in Flooring margins. For investors, the results and forecasts are relevant, but execution and the durability of margins remain important measures to track.

Key Highlights

• Kitex rose 18% after moving from a year-earlier loss to a Q2FY27 profit of ₹13.71 crore.
• Kitex revenue grew 66% year on year to ₹203.03 crore.
• Trident’s revenue declined 3.8%, but gross and EBITDA margins expanded.
• Trident approved ₹4,650 crore in capacity expansion and modernisation capex.
• Welspun Living posted 16.9% revenue growth and a 12.9% EBITDA margin.

Investor Note: The rally reflects strong results at some companies, but the quarter also showed uneven revenue trends and company-specific execution demands. Investors may want to distinguish reported performance from brokerage forecasts and monitor whether growth, margins and planned capacity additions develop as expected.