Pearl Global Industries, one of the country’s largest listed garment exporters, has been buzzing off late, not because of any major company updates, but because the stock has been receiving target price upgrades from domestic brokerage houses.
JM Financial has joined other brokerages in making a bullish call on the company’s growth prospects. In its recent report, the brokerage has initiated coverage on the stock with a Buy rating and a target price of ₹1,610. The target price implies an upside potential of 24% from the stock’s latest closing price of ₹1,302.
JM Financial believes Pearl Global Industries’ diversified five-country manufacturing network allows it to optimize production based on tariffs, customer requirements, and proximity to end markets.
India offers the largest utilization opportunity, with 25.9 million pieces of FY26 capacity running at around 62% utilization, allowing higher utilization to boost revenue and EBITDA without the capital intensity of a greenfield build-out.
It also noted that Pearl Global operates 25 manufacturing units, including 16 in-house and nine through partnerships, with a combined capacity of around 108 million pieces. Its partnership model allows the company to add capacity without carrying the full capital cost on its balance sheet.
The brokerage highlighted operating leverage as a key growth driver, noting that EBITDA margins rose from 9% in FY25 to 9.2% in FY26. As utilization improves in India and Indonesia continues to ramp up, incremental volumes can generate higher EBITDA growth on a largely fixed cost base.
While keeping its bullish view on the company, the company flagged risks including US consumer demand, trade policy, geographical and customer concentration, India’s ramp-up, Vietnam realizations, and foreign exchange movements.
PL Capital, ICICI Direct and Motilal Oswal also revised price targets higher
Last week, PL Capital upgraded its rating on Pearl Global Industries to ‘Buy’ from ‘Accumulate’ and raised its target price to ₹1,500 per share. ICICI Direct also raised its earnings estimates for FY27 and FY28, while introducing FY29 estimates in its latest note.
Following the revision, the brokerage upgraded its recommendation to ‘Buy’ from ‘Hold’ and set a revised price target of ₹1,600 per share.
Motilal Oswal has raised its earnings estimates and reiterated its ‘Buy’ rating, with a revised target price of ₹1,500, valuing the stock at 18 times FY28 estimated EV/EBITDA, compared with its earlier target price of ₹1,360.
“We expect PGIL’s growth to be driven by capacity additions across geographies, backward integration, and expansion in product categories. Its asset-light model supports strong return ratios, positioning the company for a gradual recovery in earnings quality,” the brokerage said in its September note.
Wealth Creator
The company’s shares have maintained a strong upward trajectory in recent years, delivering massive returns to shareholders and emerging as one of the biggest wealth creators in the Indian stock market. It has delivered positive returns in each of the last seven years, including two multibagger years.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
