Karachi: Interloop Ltd (ILP) is anticipated to report a significant rise in earnings for the third quarter of fiscal year 2026, with expectations for earnings per share (EPS) to surge 2.4 times year-on-year to Rs1.99. This uptick will result in a nine-month cumulative EPS of Rs6.46, marking a 3.6 times increase compared to the previous year.
According to JS Global, the increase in earnings is primarily attributed to enhanced operational performance in the company's Apparels and Denim segments. While there is an estimated 5% year-on-year decrease in revenues from the hosiery segment, this is expected to be largely counterbalanced by a 25% increase in the Denim segment and a 38% rise in the Apparel segment revenues. The improvement in margins for hosiery and denim, alongside reduced operational losses in the Apparel segment and a decline in financial charges, is projected to bolster the EPS for the third quarter.
Despite challenges such as geopolitical unrest and weakened global demand, ILP's exports have shown resilience and have surpassed the industry's year-on-year growth. However, potential LNG-related power outages could increase ILP's fuel expenses in the fourth quarter of fiscal year 2026. The company has outperformed the KSE100 index by 11% in the current calendar year to date. JS Global maintains a Buy rating for ILP, with a target price set at Rs108.