3 Fundamentally Strong Textile Stocks to Watch Out For

The size of the Indian textile manufacturing market is expected to show a steady growth, if not a phenomenal one. The industry achieved a size of US$ 128.28 billion (bn) in 2024.

According to IMARC Group, it is expected to reach US$ 190.57 by 2033, with a CAGR of 4.15% during the period from 2025 to 2033. This growth can be attributed to factors such as government initiatives like the PLI scheme, increased exports, and rising domestic demand for apparel and home textiles.

As the industry grows here are a few textile companies that you could place on your watchlist from the sector.

How Have These Textile Stocks Been Selected?

These selections are based on a return on capital employed of 20% or thereabouts, a consistent dividend history, and future growth plans.

However, it's worth emphasising that this is not a fundamental analysis. It's crucial to understand that stock valuation is never an exact science as it inherently relies on numerous assumptions, subjective interpretations, and uncertainties about what lies ahead.

#1 Pearl Global Industries

First on our list is Pearl Global Industries.

This company has a strong presence across India, Indonesia, Bangladesh, Vietnam, Guatemala, the US, Spain, Hong Kong, the UK, and the UAE.

Global brands such as Big W, Zara, Aritzia, Tommy Hilfiger, Calvin Klein, Polo Ralph Lauren, Kohl's, PVH, Inditex, GAP, Old Navy, Macy's, Muji, Talbots, Walmart (Canada and Mexico), Target (Australia), and others source from Pearl Global.

The company has a good track record of paying dividends and has a ROCE of 31.1%.

Source: Equitymaster

Global apparel imports are facing a slowdown across major markets like the US, EU, and the UK, driven by economic uncertainty, evolving consumer preferences, and rising supply chain costs.

Despite this trend, the company continues to expand its bookings and broaden its customer base. It has successfully added prestigious global brands to its portfolio.

The Q2 FY26 results of Pearl Global were good despite the above challenges. The company reported revenues of Rs 13,129 m vs Rs 12,019 YoY. Net profits surged to Rs 720 m vs 556 m YoY.

Moving ahead, Pearl Global Industries is planning to scale its capacity to 135 m pieces, achieve a 12-14% revenue CAGR, deliver double-digit EBITDA margins, and maintain ROCE above 20%.

The company is expanding across India, Bangladesh, Vietnam, Indonesia, and Guatemala, while deepening its presence in the US, UK, Japan.

Overall, Pearl Global Industries is positioned well for profitable growth with diversified geographical exposure, ongoing capacity additions, and increasing brand recognition in global fashion sourcing.

To know more check the Pearl Global fact sheet and latest quarterly results.

#2 Siyaram Silk Mills

Siyaram Silk Mills is a leading Indian textile and garment manufacturing company established in 1978.

Siyaram's product portfolio includes fabrics for shirting, suiting, and apparel, along with home furnishings and yarns.

The company also owns several marquee brands like Oxemberg, J. Hampstead, and Mistair, and it collaborates with international brands like the Italian lifestyle fabric brand Cadini.

The company has a good track record of paying dividends and has a ROCE of 22.1%.

Source: Equitymaster

In FY25, Siyaram Silk Mills delivered a healthy performance, marked by an 8% growth in total income. The EBITDA went up 9.4% to touch Rs 3530 m, while PAT stood at Rs 1,990 m - a growth of 7.6% over FY24. The revenue mix for the year was: fabric at 81%, garments at 13% and others at 6%.

The company reported revenues of Rs 7,056 for Q2 FY26 against Rs 6,079 m YoY, a growth of 16%.

Net profits grew 27% in Q2 FY26, jumping from Rs 682 m to Rs 867 m YoY.

Moving ahead, the company has launched a new fast fashion brand - ZECODE. To cater to ethnic wear the company launched DEVO.

Siyaram Silk Mills' strategy going ahead will be to build on its distribution and retail network. The management expects to expand the frontiers of the business across the existing and new segments of growth.

The management is focused on driving the next phase of growth by maintaining healthy margins despite an increase in the expenditure for opening of new stores and promoting the brands.

To know more check the Siyaram Silk Mills fact sheet and latest quarterly results.

#3 Kewal Kiran Clothing

Next on out list is Kewal Kiran Clothing.

Kewal Kiran Clothing specialises in casual, formal, and semi-formal western wear for men, women, and kids.

The company operates a portfolio of well-known brands including Killer, LawmanPg3, Integriti, Easies, Kraus (focused on women's denim and casual wear), Junior Killer (kids wear), and Desibelle (women's fashion).

The company designs, manufactures, markets, and retails its products through exclusive brand outlets and various retail formats in India and the Middle East.

Kewal Kiran Clothing has a good track record of paying dividends and has a ROCE of 25.3%.

Source: Equitymaster

On the financial front, revenue from operations for Q2 FY26 grew 14.9% to Rs 3,541m compared to Rs 3,082 m in Q2 FY25.

Gross margin for Q2 FY26 stood at 42.1%. However, the company saw a dip in net profits to Rs 474 m from Rs 677 m.

Moving ahead, the company is committed to expanding its network of exclusive brand outlets (EBOs). The strong performance of the existing EBOs has instilled confidence in this strategy, and management believes that further expansion will continue to yield positive results.

Kewal Kiran Clothing remains optimistic about consumer sentiment. The focus will remain on innovation-led brand building and reinforcing its position as a premier lifestyle brand catering to diverse demographics across genders and ages.

To know more check the Kewal Kiran Clothing fact sheet and latest quarterly results.

Should You Consider Textile Stocks?

The textile industry is poised for a steady growth in the coming years. Some textile companies are gaining attention due to their growth prospects and sector trends.

However, these stocks require careful evaluation and active portfolio management to navigate the inherent volatility and sector-specific challenges effectively.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

To know what's moving the Indian stock markets today, check out the most recent share market updates here.

Happy investing.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...