Gokak Textiles Limited’s Board of Directors has approved the permanent closure and subsequent sale of its knitwear unit/factory located in Bagalkot Road, Village Marihal, Belagavi, Karnataka. The decision comes after years of declining performance in the knitwear business. The closure is subject to regulatory approvals, with the sale of land, building, and machinery expected to be completed by October 2026.
Knitwear Unit Closure and Sale Approved
In a significant operational restructuring, the Board of Directors of Gokak Textiles Limited, in its meeting held on August 11, 2026, has approved the permanent closure and subsequent sale of the company’s knitwear unit/factory. This unit, situated at Bagalkot Road, Village Marihal, Belagavi, Karnataka, will be sold on an ‘as is where is’ basis, pending necessary statutory and regulatory approvals.
Rationale for Closure
The decision follows a period of declining overall performance in the knitwear business over the past years. The knitwear unit, established in 1995 on 15.65 acres of freehold land, was primarily geared towards the export market. While it also catered to the local market, specialized garmenting machines were relocated to the company’s Mills Division in 2015-16, leaving only cutting and stitching facilities at the Marihal unit. Reasons cited for the closure include structural cost disadvantages, operational unviability, adverse textile industry conditions, machinery obsolescence, industrial relations issues, and environmental and regulatory restrictions.
Sale Agreement and Timeline
An agreement for the sale of the land, building, and machinery of the knitwear unit was previously signed in September 2025 with M/s V. G. Parekh & Co. The transaction, valued at Rs. 19.50 Crores, is expected to be completed by October 2026. For the financial year 2025-2026, the knitwear business contributed approximately 9.76% to the total revenue, amounting to Rs. 422.73 lakhs. As of March 31, 2026, the net worth of the knitwear unit was negative at Rs. (4,192.55) lakhs, contributing 21.58% to the Company’s negative net worth of Rs. (19,423.50) lakhs.
Previous Communications
This decision is in continuance of previous communications regarding the unit, including those dated September 09, 2025, January 27, 2026, and May 07, 2026.
Source: BSE
