Karnika Industries Ltd. (KARNIKA)
SME CapConsumer stocks · SME cap · NSE
Karnika Industries is an integrated kidswear platform with over 15 years of legacy in manufacturing, brands, and distribution. It operates an asset-light model with 4 manufacturing facilities in Howrah, PAN-India distribution across 28 states, and an omnichannel presence. The company focuses on scalable operations and diversified growth in the fast-growing Indian kidswear market.
One read, four checks
75+ is strong, 60-74 is usable, 45-59 is mixed, and below 45 needs caution. These are research lenses, not buy/sell instructions.
Weak fundamentals, management trust is acceptable, price trend argues for patience, and recent execution is mixed.
Fundamental lens: valuation, quality, growth, balance sheet, and cash flow.
low confidence · 0/0 claims checked
Timing lens: price trend and sector relative strength.
Rolling lens: recent quarterly delivery, not the latest single-result score.
Quarter ended 30 Jun 2026
Average · 30/100YoY data unavailable — classification deferred
| Metric | This quarter | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹73.8 Cr | NDF | +2.8% |
| EBITDA | ₹12.7 Cr | NDF | +65.4% |
| Operating margin | 17.2% | NDF | +652 bps |
| PAT | ₹9.1 Cr | NDF | -1.9% |
| PAT margin | 12.4% | NDF | -60 bps |
NDF means not disclosed in the current structured filing feed. It is intentionally not treated as zero.
Business & thesis
Growth engines, tailwinds/headwinds, and risk radar from management commentary
Business & thesis
Growth engines, tailwinds/headwinds, and risk radar from management commentary
Where growth can come from, and what can break the case
Karnika Industries reported exceptional Q1 FY27 performance with revenue up 121.6% YoY, EBITDA up 154.9% YoY, and PAT up 197.1% YoY, driven by strong demand, operating leverage, and disciplined execution. Margins expanded significantly.
Karnika's Q1 FY27 results demonstrate strong execution and capitalize on the growing organized kidswear market. The asset-light model and omnichannel strategy appear to be driving significant top-line growth and margin expansion. The acquisition of Kidcity further strengthens its integrated platform and consumer reach, positioning it for continued profitable growth.
Revenue by Product Category (Q1 FY27)
Latest issuer-disclosed distribution across 4 reported categories.
Integrated Kidswear Platform
PositiveBuilding India's largest integrated kidswear platform at scale, with end-to-end control from sourcing to consumer shelf, enabling better quality and faster response.
Omnichannel Presence
PositiveConnecting every parent everywhere through extensive distributor networks, marketplace partnerships, institutional B2B, D2C channels, kiosks (55+), and shop-in-shop.
Fast-Growing Kidswear Market
PositiveWell positioned in India's fast-growing kidswear market, driven by rising disposable income, e-commerce growth, sustainability preference, and smaller families.
Kidcity Acquisition
PositiveAcquired a 75% controlling stake in Kidcity, a fast-growing D2C and omni-channel kidswear brand, expanding consumer reach and diversifying revenue streams.
Capacity Utilization
PositiveAchieved 90%+ capacity utilization level for all plants, supporting growth without heavy manufacturing investments due to an asset-light model.
Asset-Light Model
PositivePartner network for 90% operations, with in-house core value addition, enhances scalability and reduces fixed costs, enabling growth without additional capex on plant.
Rising Disposable Income
PositiveIncrease in urban and semi-urban families' spending power drives demand for kidswear.
E-commerce & D2C Growth
PositiveOnline channels and D2C brands are making branded kidswear more accessible.
Tier II/III Expansion
PositiveHuge demand from aspiring consumers outside metros presents significant growth opportunities.
Formalization of Unorganised Sector
PositiveQuality players like Karnika can capture market share from local suppliers as the market formalizes.
Management accountability
What management said, and what results must prove
Management accountability
What management said, and what results must prove
What management said, and what results must prove
Issuer guidance and extracted claims are tracked against later reported outcomes. Treat these as management statements, not IndiaPulse forecasts.
YoY comparison is crucial for a consumer business like kidswear due to potential seasonality. QoQ comparison is also relevant to assess sequential momentum and the impact of recent strategic initiatives and operating leverage.
Revenue Growth
PositiveRevenue from Operations grew 121.6% YoY to INR 74 Cr in Q1 FY27.
Gross Margins
Under StressGross Margins were 33.6% in FY26, reflecting product mix transition and input cost normalization post peak FY22 levels (50.4% in FY22).
EBITDA Margins
PositiveEBITDA Margins expanded by 225 bps YoY to 17.2% in Q1 FY27, and by 652 bps QoQ from 10.7% in Q4 FY26.
Distribution Expansion
PositivePan-India distribution network covers 28 states with 150+ distribution partners. Omnichannel presence includes D2C, marketplaces, institutional B2B, kiosks (55+), and shop-in-shop.
Strong Start to FY27
PositiveFY27 has commenced on a strong note, driven by the strength of our integrated business model, expanding distribution network, and growing acceptance of our branded kidswear portfolio.
Focus Areas
NeutralFocus remains on strengthening brand equity, expanding market reach, enhancing operational efficiencies, and delivering sustainable profitable growth.
Long-term Opportunity
PositiveIndia's branded kidswear market continues to offer significant long-term opportunities as the shift toward organized players accelerates.
Numbers and claims to verify in the next filings
| Checkpoint | Current evidence | What to verify next |
|---|---|---|
| Revenue Growth | 121.6% YoY (Q1 FY27) | Sustained high double-digit revenue growth, indicating continued market penetration and brand acceptance. |
| EBITDA Margins | 17.2% (Q1 FY27) | Further margin expansion, demonstrating operating leverage and efficient cost management as volumes grow. |
| Net Debt-to-Equity | 0.8x (FY26) | Maintenance of low leverage, ensuring financial flexibility for future growth initiatives. |
| Capacity Utilization | 90%+ (FY26) | Continued high utilization levels, validating the asset-light model's efficiency and scalability. |
Verification checkpoints are IndiaPulse research interpretation, not investment advice.
Trend score and candlestick chart
44NeutralSMA20 -1.6% / mo · MACD + · near 52W low
Technical chart
KARNIKAdaily · 1Y · AUTO+7.4%Daily technical trend read
Mixed signalsSignals are conflicting — long-term trend down. RSI 55. Wait for confirmation.
- Price below SMA200 (long-term downtrend) — short-term bounces likely countertrend.
- SMA20 falling (~1.7% over last month) — short-term momentum negative.
- RSI(14) at 55 — rising, no extreme reading.
- MACD above signal, histogram expanding — bullish momentum building.
- 41% off 52W high · 31% above 52W low.
Mechanical read from the price + indicator series above. Not a recommendation — technical setups can reverse without warning, especially around earnings and macro events.
Valuation & score drivers
U-Score 27 · OVERVALUED · pillar breakdown, sector model, fair-value anchor
Valuation & score drivers
U-Score 27 · OVERVALUED · pillar breakdown, sector model, fair-value anchor
Fundamental score breakdown
OVERVALUEDWhy this score?
Top U-Score contributors and drags from the latest stored fundamentals.
Positive drivers
- Quality contributes 13/20 to the score.
- Balance sheet contributes 8/15 to the score.
- Cash flow contributes 1/10 to the score.
Main drags
- Fair-value margin of safety is negative at -254.9%.
- Valuation is weaker at 0/30; verify the latest quarterly trend.
- Growth is weaker at 2/25; verify the latest quarterly trend.
Cyclical valuation: normalized earnings, not just trailing PE
Cyclical companies can look cheapest near peak profits, so IndiaPulse flags value-trap risk separately.
Stored run vs live recompute
This shows the stored score trend when snapshots exist, and also compares the latest stored nightly score with a live recompute from current fundamentals and price.
Score history
12 stored score snapshots. Latest stored move: -2 points.
Factor attribution
Modelled fair value
Trust score
Does management behaviour match later outcomes? Claim delivery, forensic breakdown, evidence depth
Trust score
Does management behaviour match later outcomes? Claim delivery, forensic breakdown, evidence depth
Trust asks: does management behaviour match later outcomes? Higher is better, but confidence and evidence depth matter as much as the number.
Mixed Trust: Claim history is still being built. It ranks around the 49th percentile of the scored universe and 52nd percentile within Consumer. Main check: cash conversion is weak at 43/100.
Healthy Trust Lite: Promoter holding is 73.4%. Key concern: Only 0 years of positive FCF.
Usable, but needs evidence. Treat guidance with a margin of safety.
overall median 67 · Consumer: 52nd pctile, median 66 · SME: 60th pctile, median 64
4 documents have extracted text, but claim history is not strong enough yet.
0 claims extracted · No contradicted claim yet
How to read this Trust Score
Mixed Trust · low confidenceRead Trust alongside U-Score, result consistency, and technical trend. A cheap stock with weak Trust needs a larger margin of safety; a high Trust score does not make an expensive stock attractive by itself.
Forensic breakdown
Read low sub-scores as due-diligence warnings, not automatic sell signals.
Trust positives
- ▸Promoter holding is 73.4%.
- ▸Promoter pledge is zero.
Trust risks
- ▸Only 0 years of positive FCF.
Trust Lite uses financial behaviour only. Prefer claim-tested Trust when enough concall claims have later outcomes.
Financials
Full fundamentals table and 10-year revenue / profit / ROE history
Financials
Full fundamentals table and 10-year revenue / profit / ROE history
Fundamentals
Valuation
- P/E
- 26.20
- P/B
- 7.56
- EV/EBITDA
- 20.74
- Market Cap
- 733.00Cr
Profitability
- ROE
- 29.00%
- ROCE
- —
- ROA
- 13.02%
- Dividend Y
- 0.08%
Growth (CAGR)
- Revenue 5Y
- —
- EPS 5Y
- —
- Revenue 3Y
- —
- EPS 3Y
- —
Balance Sheet
- Debt/Equity
- 0.79
- Interest Coverage
- 7.40×
- Altman Z
- 5.80
- Book Value
- 15.60
Cash Flow
- FCF Yield
- —
- FCF Positive Y
- 0/5
- OCF
- 16.00 Cr
- EPS TTM
- 4.51
Shareholding
- Promoter Hold
- 73.39%
- Promoter Pledge
- 0.00%
- Momentum 52W
- 26%
Financial History
Updated 5/9/2026
Revenue
₹ CrNet Profit
₹ CrReturn on Equity
%Peers
Business-comparable names in Consumer, ranked by similarity
Peers
Business-comparable names in Consumer, ranked by similarity
Peers
Business-comparable peers in Consumer — ranked by industry, sub-sector, theme-tag overlap, market cap, and U-Score similarity. Green cells mark the best available peer metric in this table.