⚡ Flash Summary
Interloop Limited (ILP) reported a strong start to FY2026, demonstrating resilience amidst a challenging economic backdrop. The company recorded a 5.14% increase in unconsolidated revenue, reaching Rs. 43,774 million, and a substantial 31.25% rise in gross profit. This growth was primarily attributed to a favorable sales mix, effective cost management, and improved utilization. Profit after taxation surged to Rs. 2,797 million, with earnings per share (EPS) improving significantly to Rs. 2.00, reflecting enhanced operating margins and efficient cost control.
Signal: BUY 📈
Strength: 8/10
Sentiment: POSITIVE
Time Horizon: MEDIUM_TERM
📌 Key Takeaways
- 📈 Revenue growth of 5.14% (unconsolidated) and 5.7% (consolidated) year-over-year, indicating sustained momentum.
- 💰 Unconsolidated Gross Profit surged by 31.25% to Rs. 10,183 million, showcasing improved profitability.
- 📊 Consolidated Gross Profit increased by 29.2% to Rs. 10,520 million.
- 🚀 Unconsolidated Profit from Operations soared by 67.72% to Rs. 6,241 million, driven by controlled operating expenses.
- ✅ Consolidated Profit from Operations increased by 62.3% to Rs. 6,237 million.
- 💸 Financial costs decreased by 41% due to reduced borrowings, boosting net profit.
- ⭐ Unconsolidated Net Profit after taxation surged to Rs. 2,797 million, a 1,158.53% increase.
- 🌟 Consolidated Net Profit after tax surged to Rs. 2,742 million, a 720% increase.
- 🧾 Unconsolidated EPS improved to Rs. 2.00 from Rs. 0.16 in the same period last year.
- 💎 Consolidated EPS improved significantly to Rs. 1.96 from Rs. 0.24.
- 🌍 Textile exports increased by 5.6% year-on-year, reaching USD 4.8 billion.
- 🧶 Knitwear led sector growth with a 12.2% increase to USD 1.4 billion.
- ✅ Pakistan reached a staff-level agreement with the IMF, expected to unlock further external financing.
- 🌱 The company obtained BCI certification across all units for traceable and sustainable cotton sourcing.
🎯 Investment Thesis
Interloop Limited presents a compelling investment opportunity based on its strong Q1 FY2026 results, demonstrating robust revenue growth, improved profitability, and efficient cost management. Given the impressive surge in EPS and profit after taxation, I recommend a BUY rating with a price target of Rs. 180, based on an estimated P/E ratio of 15x FY26 EPS, within a medium-term horizon of 12-18 months.
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Disclaimer: AI-generated analysis. Not financial advice.