Company Overview
Credo Brands Marketing Limited (BSE: 544058, NSE: MUFTI) reported mixed FY26 results with declining profitability but maintained strong operational metrics and announced significant corporate actions through its 27th Annual General Meeting.
Financial Performance FY2025-26
Revenue from operations declined 4.2% year-over-year to ₹592.10 crore (₹5,921.03 million) from ₹618.18 crore in FY25. Net profit showed a more pronounced decline of 30.7% to ₹47.42 crore (₹474.24 million) compared to ₹68.41 crore in the previous year. Profit before tax stood at ₹63.80 crore, down from ₹91.83 crore in FY25.
Despite the profit decline, the company maintained healthy gross profit margins of 58.4% (improved from 57.2% in FY25) and generated strong EBITDA of ₹154.2 crore with a margin of 26.0%. The balance sheet remained robust with no financial debt, net debt-to-equity ratio improving to 35.5%, and cash equivalents of ₹726.08 million. Operating cash flow was strong at ₹132.4 crore.
Dividend and Capital Allocation
The Board recommended a final dividend of ₹2.00 per equity share (100% of face value) for FY26, with a record date of August 28, 2026. Total dividend payout increased significantly to ₹196.11 million from ₹32.48 million in FY25, reflecting the company's commitment to shareholder returns despite profit pressures.
Annual General Meeting Details
The 27th AGM is scheduled for September 11, 2026, to be held virtually via video conferencing. Key agenda items include adoption of financial statements, dividend declaration, and reappointment of directors including Mrs. Poonam Khushlani (retiring by rotation) and Mr. Kamal Khushlani as Chairman and Managing Director for another 5-year term effective March 8, 2027.
Operational and Business Highlights
The company continued its MUFTI 2.0 transformation strategy with 28 stores operating under the new retail identity (14 new + 14 renovated). The retail network comprised 429 Exclusive Brand Outlets, 148 Large Format Stores, and 1,336 Multi-Brand Outlets across 583 Indian cities. Website revenue grew approximately 74% YoY, and the Muftisphere loyalty platform surpassed 3 million customers. Advertising and branding spend accounted for 5-6% of revenue in FY26, with plans to increase to 8-10% in FY27.
Exceptional Items and Regulatory Impact
FY26 results included an exceptional item of ₹13.97 million related to the impact of New Labour Codes notified effective November 21, 2025. The codes changed the wage definition for gratuity calculation to at least 50% of total remuneration, resulting in increased defined benefit obligations. Gross trade receivables stood at ₹2,455.73 million with an allowance for doubtful debts of ₹92.88 million.
Corporate Governance and Shareholding
The Board maintained strong governance standards with 6 directors (including 2 women directors and 3 independent directors). Promoter holding remained stable at 55.01%, with the Khushlani family collectively holding approximately 54.01%. Major institutional shareholders included Bennett, Coleman & Company Limited with 8.24% stake. The company maintained CARE A+ (Stable) credit ratings for long-term facilities.
Regulatory Compliance and Disclosures
The company confirmed full compliance with SEBI LODR regulations and various statutory requirements including CSR expenditure of ₹18.60 million on healthcare initiatives. Contingent liabilities of ₹53.40 million primarily related to GST and income tax matters were disclosed, though management believes resolution won't have material adverse effects.