SP Apparels Limited (SPAL) has reported robust financial results for the second quarter, with significant improvements across its various business segments. The company's consolidated revenue grew by 9.2% year-on-year to INR 427.00 crores, while profit after tax (PAT) surged by 58.4% to INR 34.70 crores.

Key Highlights

• Consolidated revenue: INR 427.00 crores (9.2% YoY growth)
• PAT: INR 34.70 crores (58.4% YoY growth)
• SPUK division: Achieved positive EBITDA of INR 1.10 crores
• Retail division: Reported positive EBITDA of INR 0.53 crores

Segment-wise Performance

Garment Division

The garment division, including Young Brand Apparel, reported an adjusted revenue of INR 389.00 crores, marking a 10.2% year-on-year growth. The adjusted EBITDA for this segment stood at INR 66.60 crores, showing a 16.7% increase from the previous year.

SPUK Division

SPUK division achieved a significant milestone by turning profitable. It reported a revenue of INR 18.00 crores with a positive EBITDA of INR 1.10 crores, compared to a loss in the same quarter last year.

Retail Division

The retail division also showed remarkable improvement, with revenue of INR 21.70 crores and a positive EBITDA of INR 0.53 crores, compared to a loss of INR 0.88 crores in the previous comparable quarter. Within the retail division:

• Crocodile brand revenue: INR 16.00 crores
• Angel & Rocket revenue: INR 5.00 crores

Export Performance

SP Apparels' export business witnessed strong growth, with export quantity reaching 18.9 million pieces in the current quarter, compared to 15.3 million pieces in the same quarter of the previous year, representing a 24% year-on-year increase.

Operational Updates

1. Sri Lanka Operations: The company has strengthened its presence in Sri Lanka, aiming to leverage the country's cost-effective manufacturing environment and duty-free access to Europe and the UK.

2. Capacity Utilization: SP Apparels maintained a healthy capacity utilization of around 83% in India, supported by strong demand and new customer additions across Europe and the UK.

3. U.S. Tariff Impact: The company is actively managing the impact of increased U.S. tariffs by exploring opportunities with European and UK customers to mitigate potential risks.

4. Retail Business Turnaround: The retail division's positive EBITDA marks a significant milestone, driven by strong performance of the Crocodile brand and growing traction for Angel & Rocket.

Future Outlook

Despite challenges in the U.S. market due to tariff issues, SP Apparels maintains its revenue guidance of INR 2,000.00 crores. The company plans to focus on stabilizing its recent expansions before considering further capacity additions.

Mr. P. Sundararajan, Chairman and Managing Director, commented, "We are delighted to report that all our divisions have delivered strong performance in Q2. Notably, retail and SP divisions have reported positive EBITDA during the quarter, marking a significant milestone in our turnaround strategy."

The company remains optimistic about its growth prospects, leveraging its integrated model, diversified customer base, and strategic expansions in Sri Lanka to drive sustainable growth in the coming years.

Financial Position

As of the latest report, SP Apparels' gross debt on a standalone basis stood at INR 263.00 crores, with a net debt of INR 229.00 crores. On a consolidated basis, the net debt is INR 303.00 crores.

SP Apparels continues to demonstrate resilience and adaptability in the face of global market challenges, positioning itself for sustained growth and profitability across its diverse business segments.

SP Apparels Limited , a leading textile manufacturer, has reported a strong financial performance for the second quarter of fiscal year 2026, with significant growth in revenue and profitability.

Key Financial Highlights

• Consolidated net profit jumped 58.3% year-over-year to ₹347.00 million, up from ₹219.20 million in Q2 FY25.
• Consolidated revenue grew by 10.3% to ₹4,273.43 million, compared to ₹3,936.80 million in the same quarter last year.
• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) rose to ₹704.50 million, marking a substantial 35.3% increase from ₹520.70 million in Q2 FY25.
• EBITDA margin expanded to 16.5% from 13.2% in the corresponding quarter of the previous year.
• Earnings per share (EPS) for the quarter improved to ₹13.80, up from ₹8.70 in Q2 FY25.

Segment Performance

The company's performance across various segments showed positive trends:

• The Garment Division, including Young Brand Apparel, reported revenue of ₹3,892.10 million with an adjusted EBITDA of ₹665.50 million, maintaining a healthy EBITDA margin of 17.1%.
• SP Retail Ventures Limited contributed revenue of ₹216.80 million with an EBITDA of ₹5.30 million.
• SP Apparels UK (P) Limited generated revenue of ₹179.90 million and an EBITDA of ₹11.30 million.

Operational Highlights

• Export volumes increased significantly, with sales quantity reaching 18.9 million pieces compared to 15.3 million pieces in Q2 FY25.
• The company maintained strong operational efficiency, reflected in the improved EBITDA margins.

Balance Sheet and Cash Flow

As of September 30, 2025, SP Apparels reported:

• Total assets of ₹13,440.40 million, up from ₹12,688.70 million as of March 31, 2025.
• A robust equity position with total equity of ₹8,957.07 million.
• Healthy cash and cash equivalents of ₹342.49 million.

The company's cash flow from operating activities for the half-year ended September 30, 2025, stood at ₹990.89 million, indicating strong operational cash generation.

Management Commentary

P. Sundararajan, Managing Director of SP Apparels Limited, commented on the results: "We are pleased with our performance this quarter, which demonstrates the resilience of our business model and the effectiveness of our strategic initiatives. The significant growth in profitability and improved margins reflect our focus on operational excellence and cost management. We remain committed to delivering value to our shareholders and maintaining our growth trajectory."

Future Outlook

While the company has not provided specific forward-looking statements, the strong performance in Q2 FY26 positions SP Apparels well for continued growth. The increased export volumes and improved operational efficiencies suggest a positive outlook for the coming quarters.

Investors and analysts will likely watch for the company's ability to maintain its growth momentum and further improve its margins in the face of global economic uncertainties and potential fluctuations in raw material costs.

SP Apparels Limited continues to strengthen its position in the textile industry, leveraging its manufacturing capabilities and diverse product portfolio to drive sustainable growth.