1. Opening Hook
While global cotton prices played musical chairs and textile stocks pretended volatility is “temporary,” Vardhman showed up with a straight face and shrinking margins.
Q3FY26 wasn’t disastrous, but it wasn’t exactly a victory parade either. Revenues moved up politely, EBITDA sulked, and PAT took a noticeable hit—thanks to costs, labour codes, and reality.
Management still spoke the language of sustainability, scale, and long-term dominance, as if margins were merely “resting.” Capex plans marched on confidently, even as profitability quietly asked for a breather.
This wasn’t a quarter for chest-thumping—it was one for explanations, footnotes, and future promises.
Stick around. The interesting part is not what grew, but what refused to cooperate.
2. At a Glance
- Revenue up 2% – Growth showed up, but forgot to bring enthusiasm.
- EBITDA down 6% – Operating leverage clearly took the quarter off.
- EBITDA margin down 126 bps – Cost pressures doing what they do best.
- PAT down 17% – Profits reacted faster than management narratives.
- EPS at ₹5.88 – From ₹7.04 last year, gravity remains undefeated.
3. Management’s Key Commentary
“Demand environment remained stable during the quarter.”
(Stable, yes. Helpful? Not particularly.) 😏
“Margins were impacted due to higher input and employee costs.”
(Translation: costs rose faster than prices,
again.)
“Labour code implementation resulted in a one-time impact.”
(₹23.6 Cr ‘one-time’, but the pain is very real.)
“Capex projects are progressing as per schedule.”
(Because pausing capex is not in the company’s vocabulary.)
“Processed fabric capacity additions will be operational by Q4 FY26.”
(Hope margins also get commissioned alongside machines.)
“Sustainability initiatives remain a key focus area.”
(Long-term applause, short-term margin sacrifice.)
“We remain confident about long-term textile demand.”
(The classic closing line—works every quarter.)
4. Numbers Decoded
| Metric | Q3FY26 | YoY Change | What It Really Means |
|---|---|---|---|
| Revenue | ₹2,452 Cr | +2% | Volumes helped, pricing didn’t |
| EBITDA | ₹360 Cr | -6% | Costs clearly won this round |
| EBITDA Margin | 14.2% | -126 bps | Margin compression is not theoretical |
| PAT | ₹170 Cr | -17% | Profitability blinked first |
| EPS | ₹5.88 | -16% | Shareholders noticed |
Key driver: Labour code provisioning and operating cost inflation did most of the damage.
5. Analyst Questions
- Q: When do margins recover?
A: “As capacities stabilize and costs
