At a Glance
Go Fashion (India) Ltd (GFIL) just pulled off a Q1 where revenue rose 1.2% YoY to ₹223 crore, but net profit decided to take a summer vacation, diving 22% to ₹22 crore. The stock immediately reflected the mood, tanking over 7%. Despite adding 27 new stores, the company’s bottom line looks like a pair of jeans post-diabetes diet – slimmer than expected. To add flair, management announced plans to expand into Dubai, because when in doubt, blame “international expansion.”
Introduction
Welcome to the land of leggings, jeggings, palazzos, and profits that don’t match the vibrant colors they sell. Go Fashion has built its empire on one simple truth: Indian women love options. Over 120 colors, 50 styles – basically a Pantone book in fabric form. Yet, investors today seem to be asking, “How many shades of red can your P&L bleed?”
The stock’s 33% fall over the past year shows investors are not exactly screaming “Go Colors, Go Profits.” The company’s high P/E of 44 is still acting like it’s selling Birkin bags, not bottom wear. Meanwhile, competition from Trent and Vedant Fashions is like Bollywood – flashy, well-funded, and stealing the show.
Business Model (WTF Do They Even Do?)
Go Fashion’s business model is retail chic with a twist. They design, source, and sell women’s bottom-wear under the Go Colors brand. Unlike others who dabble in full wardrobes, GFIL goes niche – only bottoms, because why complicate life? The retail network consists of exclusive brand outlets (EBOs), large-format stores, and online marketplaces. Manufacturing is outsourced, keeping it asset-light-ish.
Revenue streams are dominated by offline sales (over 80%), which is risky in a world where consumers are one swipe away from ditching your product. The company’s USP – variety and fit – keeps footfalls steady, but margins are always at the mercy of cotton prices, rentals, and discounting frenzy.
Financials Overview
Quarterly Recap (Q1 FY26):
- Revenue: ₹223 Cr (↑1.2% YoY)
- Operating Profit (EBITDA): ₹69 Cr, OPM 31% (flat YoY)
- PAT: ₹22 Cr (↓22% YoY)
- EPS: ₹4.12
For FY25, GFIL delivered:
- Revenue: ₹848 Cr (↑11% YoY)
- PAT: ₹94 Cr (↑13% YoY)
- Margins: Still holding at ~31% OPM, which is decent.
Commentary: Growth is stalling like a Bollywood sequel. The slight revenue uptick isn’t enough to justify a premium P/E, while PAT contraction hints at cost pressures and maybe some aggressive expansion burns.
Valuation
Current Price ₹764. P/E? A spicy 44.1. Book value ₹129 → P/B 5.9.
Fair Value Range
- P/E Method:
Industry median P/E ~46. Using a conservative 35× FY26E EPS (₹18.5 annualized):
→ Fair Price ≈ ₹648 - EV/EBITDA Method:
Assume EV/EBITDA multiple of 18×, EBITDA FY25 ₹265 Cr → EV ≈ ₹4,770 Cr → Price ≈ ₹885 - DCF (quick and dirty):
Assume 10% growth, 12% WACC, terminal growth 3% → FV ≈ ₹720
Fair Value Range: ₹650 – ₹880
(Current price is at the mid-upper end, meaning upside is as tight as skinny jeans.)
What’s Cooking – News, Triggers, Drama
- Dubai Calling: Plans to open stores in Dubai – because why just bleed in INR when you can do it in AED?
- 27 New Stores: Aggressive expansion may boost topline, but costs are already biting.
- Category Expansion: Management hinted at new product lines – maybe tops? Shoes? Scarves? Anything to make numbers less embarrassing.
- Market Sentiment: Stock down 33% YoY. Investor confidence needs a caffeine shot.
Balance Sheet
| Particulars (₹ Cr) | Mar 23 | Mar 24 | Mar 25 |
|---|---|---|---|
| Assets | 931 | 1,145 | 1,280 |
| Liabilities | 465 | 595 | 637 |
| Net Worth | 520 | 604 | 697 |
| Borrowings | 340 | 469 | 507 |
Auditor Remark: Borrowings creeping up like waistlines during holidays. Assets healthy, but leverage isn’t slimming down.
Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating CF | 104 | 219 | 199 |
| Investing CF | -28 | -73 | -76 |
| Financing CF | -84 | -108 | -123 |
Remark: Operating cash flows strong, but expansion capex is eating liquidity. Financing outflows signal debt repayments + no dividend love.
Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE | 15.3% | 15.3% | 14.4% |
| ROCE | 18% | 16% | 14.9% |
| P/E | 60 | 50 | 44 |
| PAT Margin | 12.5% | 10.8% | 10.3% |
| D/E | 0.65 | 0.78 | 0.73 |
Comment: ROE dipping, margins thinning. P/E still in lala land.
P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 665 | 763 | 848 |
| EBITDA | 215 | 246 | 268 |
| PAT | 83 | 83 | 94 |
Remark: Revenue steady, PAT crawling. EBITDA margins holding, but don’t expect fireworks.
Peer Comparison
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Trent | 17,134 | 1,436 | 129 |
| Vedant Fashions | 1,428 | 396 | 46 |
| V2 Retail | 2,102 | 80 | 76 |
| Go Fashion | 849 | 94 | 44 |
Remark: Go Fashion is the small fish in a tank with sharks. Multiples high, growth low – recipe for indigestion.
Miscellaneous – Shareholding, Promoters
- Promoters: 52.78% (unchanged) – they’re holding on tight.
- FIIs: Down to 9.68% – foreigners leaving the party.
- DIIs: Up to 34.6% – domestic funds playing savior.
- Public: A measly 2.9% – retail doesn’t want to get burned.
Promoter Bio: The Jain family – masters of fabric but investors hope they can stitch profits back.
EduInvesting Verdict™
Go Fashion dazzles with colors, but its financial shades are getting dull. The brand has a solid niche, but the market is demanding more than just expansion news. Growth is slowing, margins under pressure, and high P/E makes it a risky couture.
SWOT
- Strengths: Strong brand, high margins, niche dominance.
- Weaknesses: Slow topline growth, high debt, no dividend.
- Opportunities: Dubai expansion, new categories, online boom.
- Threats: Trent’s aggressive expansion, input cost volatility, valuation bubble.
Conclusion:
Go Fashion needs to prove it can turn colorful products into equally colorful profits. Until then, investors may continue to treat the stock like last season’s leggings – stretchy, overpriced, and waiting for a discount.
Written by EduInvesting Team | 01 August 2025
SEO Tags: Go Fashion, Go Colors, Q1 FY26 Results, Retail Stocks, Bottom-wear Market Analysis
