Company Disclosure

Management Participants

  • Mr. Kamal Khushlani - Chairman and Managing Director
  • Mr. Rasik Mittal - Chief Financial Officer
  • Strategic Growth Advisors - Investor Relations Advisors

Financial Performance Highlights (Q1 FY27)

  • Revenue: ₹125.3 crores, representing 5% year-on-year growth
  • Gross Profit: ₹77.2 crores
  • Gross Profit Margin: 61.6%
  • EBITDA: ₹26.6 crores
  • EBITDA Margin: 21.2%
  • Profit After Tax (PAT): ₹2.3 crores
  • PAT Margin: 1.8%

Business Performance and Strategy Update

Mufti 2.0 Transformation

The company continues to advance its Mufti 2.0 strategy with focus on:

  • Premiumizing the brand
  • Elevating customer experience across stores
  • Strengthening Mufti's influence as Indian consumer aspirations evolve

Retail Network Optimization

  • Opened 5 new stores across leading malls and high streets
  • Closed 7 underperforming stores
  • Total store count: 427 stores
  • Strategy focuses on improving quality and productivity by replacing lower productivity locations with experience-led stores

Marketing and Brand Building

  • Marketing investment: 8.5% of revenue (₹10.65 crores approximately)
  • In line with full-year guidance of 8-10% through FY27
  • Growing proportion directed towards digital platforms (Google, Meta) to strengthen visibility and understand consumer behavior
  • Investments aimed at building long-term brand salience and aspiration

Operating Environment

  • Healthy consumer interest through April and part of May 2026, which moderated towards mid-May
  • Broader global environment remains uncertain with geopolitical tensions
  • Consumers remain cautious and selective in discretionary spending
  • Management remains measured about near-term demand but confident about long-term opportunity

Q&A Session Highlights

Consumer Demand Outlook

  • Management sees positive signals from renovated/new stores but considers it too early to extrapolate projections
  • Near-term demand visibility remains uneven
  • Transformation impact expected to be long-drawn (2+ years) rather than immediate

Premiumization Strategy

  • Strategy works across all markets (Tier 1, 2, 3 cities) but implementation varies by market competitiveness
  • Premiumization is relative to each market's environment and expectations
  • Does not require carrying larger or more diverse inventory - focus is on merchandise mix change

Customer Acquisition

  • Marketing investments aimed at both retaining existing customers and acquiring new younger customers
  • Essential for sustainable growth and brand health

Store Performance

  • FY26 average annual revenue per EBO: ~₹75 lakhs
  • Targeting mid-single-digit same-store revenue growth for FY27
  • New stores are generating good revenue

Inventory Management

  • Inventory days: 74 in Q1 FY27
  • Reduction anticipated in coming quarters
  • Company emphasizes selling everything at profit without write-offs (no inventory write-off history)

Growth Expectations

  • Management unable to provide specific growth projections for next 2 years
  • Evaluating positive signals from brand transformation initiatives
  • Confident in eventually returning to growth trajectory

Additional Business Insights

  • Company continues to build D2C business to get closer to consumers
  • Focus on improving footfalls and conversion through brand initiatives
  • Competition remains intense with some competitors spending ~15% on advertising
  • Company maintains mid-premium segment positioning in the market