GHCL Textiles Limited (NSE: GHCLTEXTIL) has demonstrated a resilient financial performance for the third quarter of fiscal year 2026, characterized by strong execution and a strategic shift toward high-margin business verticals. The company, a leading player in the spinning industry with state-of-the-art infrastructure in Tamil Nadu, continues to advance its roadmap for vertical integration and operational excellence.
Financial Performance and Robust Capital Strength
For Q3 FY26, GHCL Textiles reported a total income of Rs. 351 crore, representing a 22% year-on-year (YoY) increase and a 3% sequential growth. The company’s EBITDA stood at Rs. 34 crore for the quarter, reflecting a 29% YoY growth, while Profit After Tax (PAT) reached Rs. 13 crore, a significant 41% increase compared to Q3 FY25.
The company’s financial stability was further validated in January 2026, when its credit rating was upgraded by CARE Ratings from A- / A2+ to A / A1. This upgrade underscores the company’s robust capital strength, disciplined working capital management, and improved operational scale.
Performance by Business Vertical and Key Segment Developments
GHCL Textiles is successfully diversifying its revenue streams by transitioning from commodity yarn to value-added segments:
• Yarn Segment: This remains the core vertical, with sales volumes increasing by 9% to 29.7k MT in 9M FY26. Revenue from yarn reached Rs. 855 crore during this period.
• Fabric Segment: A key development is the rising contribution of fabric to the total revenue mix. The share of revenue from fabric increased to 11% in 9M FY26, up from 8% in the previous year, driven by higher sales of both knitted and greige fabrics. Fabric revenue for 9M FY26 reached Rs. 105 crore.
Operational Scale and Market Leadership
The company maintains market leadership through efficient capacity utilization, which stood at an impressive 99% in 9M FY26. Its current operational scale includes 2.25 lakh ring spindles, 3,320 rotors, and 480 vortex positions. A cornerstone of its operational excellence is its commitment to sustainability; 62 MW of green energy assets currently meet approximately 72% of the company’s power requirements, significantly reducing its environmental footprint and energy costs.
Core Growth Strategies and Strategic Expansion
GHCL Textiles is pursuing an aggressive vertical integration roadmap to enhance shareholder value and margins:
• Capacity Expansion: The company successfully commissioned 25k spindles in June 2025, which are now operating at optimal utilization.
• Forward Integration: Phase 1 of a new knitting facility (15 machines) is currently under commissioning, with commercial production expected to start in Q4 FY26. Phase 2 of this expansion is slated for FY27.
• Long-term Investment: The company has signed MoUs with the Tamil Nadu government for a Rs. 1,035 crore investment, of which approximately Rs. 600 crore has already been deployed.
• Green Energy: An additional 10 MW of green energy capacity is scheduled for commissioning by Q1 FY27, aiming to eventually cover 75% of total energy needs.
Outlook and Growth Trajectory
The company’s growth trajectory is supported by favorable macro-environmental factors, including potential Free Trade Agreements (FTAs) with the EU and New Zealand, which are expected to eliminate import duties and enhance the price competitiveness of Indian textile exports. Management anticipates that these strategic initiatives will more than double the company’s revenue and be margin accretive, with a long-term EBITDA margin target of 15-18%. By focusing on specialized yarns and premium products like Giza and Supima, GHCL Textiles is well-positioned to leverage operational synergies and sustain profitability.