Financial Performance Summary

Q2 FY27 Performance (Quarter ended September 30, 2026)

  • Revenue: ₹434 crore (decline of 2.3% YoY from ₹444 crore in Q2 FY26)
  • Gross Profit: ₹183 crore
  • Gross Margin: 42% (improved by 20 basis points YoY)
  • EBITDA: ₹62 crore
  • EBITDA Margin: 14.2%
  • PAT: ₹31 crore
  • PAT Margin: 7.2%
  • Sequential improvement: Revenue grew 15.7% and EBITDA increased 18.8% from Q1 to Q2 FY27
  • EBITDA margin expanded by 37 basis points sequentially

H1 FY27 Performance (Half Year ended September 30, 2026)

  • Revenue: ₹809 crore (decline of 1.7% YoY from ₹823 crore in H1 FY26)
  • Gross Profit: ₹340 crore
  • Gross Margin: 42% (maintained)
  • EBITDA: ₹113 crore
  • EBITDA Margin: 14%
  • PAT: ₹57 crore
  • PAT Margin: 7%
  • Same-store sales growth (SSSG): Decline of 9.2% in H1 FY27

Operational Highlights

Store Network and Expansion

  • Store network as of September 30, 2026: 86 stores
  • Total retail area: Approximately 820,000 square feet
  • H1 FY27 expansion: Opened 6 new stores adding ~56,000 square feet
  • Store rationalization: Closed 1 KLM Fashion Mall store (~20,000 square feet)
  • Business model: 100% company-owned, company-operated

Brand Portfolio Strategy

Company maintains five-brand portfolio serving different consumer segments:

  • Kalamandir: Middle class and upper middle class income segments
  • Varamahalakshmi: Traditional silk and wedding wear
  • Mandir: Premium ethnic wear segment
  • KLM Fashion Mall: Ethnic value fashion segment
  • Valli Silks: Affordable traditional ethnic wear

Inventory and Working Capital

  • Maintained higher inventory levels for ongoing festive and wedding season
  • Net debt negative position with healthy cash balance of approximately ₹249 crore
  • Inventory strategy focused on ensuring merchandise availability and wider assortment

Management Commentary and Outlook

Challenges in H1 FY27

  • Discretionary consumption environment remained challenging
  • Q1 impacted by Adhik Maas
  • Dussehra-led festive momentum shifted from September (last year) to October (this year)
  • Calendar shift coupled with high base in corresponding quarter weighed on consumer demand

Q3 FY27 Expectations

  • Festive season described as "considerably brighter" with improving consumer sentiment
  • Dussehra shift to October coupled with favorable wedding calendar extending through year-end
  • Expecting stronger demand in Q3 across all formats including KLM Fashion Mall and Varamahalakshmi Silks
  • Reported 27-30% growth in festive business (Navaratri) compared to last year

Full Year Guidance

  • Expect business momentum to normalize in second half
  • Anticipate return to positive double-digit same-store sales growth
  • Maintain full-year revenue guidance of ₹1,850-1,900 crore
  • Expect double-digit revenue growth for full year
  • Focus on operational efficiencies, inventory optimization, and improved store productivity to drive operating leverage

Silver Jewellery Business Update

  • Initial investment of ₹6-7 crores in inventory
  • Business described as self-sustainable but not showing exciting growth potential
  • Silver prices have appreciated 50-60% from initial investment
  • Emerging competition from fashion jewellery category
  • Currently viewed as effective utilization of excess store space rather than major expansion focus
  • No plans for shop-in-shop models with jewellery brands due to space constraints

Regional Market Performance

Tamil Nadu Market

  • H1 FY27 productivity: ~₹36,000 per square foot
  • Target: Reach ₹45,000-48,000 per square foot by FY27 year-end
  • Initiatives: Advertisement campaigns to improve visibility and productivity

Karnataka Market

  • Focus area for expansion with cluster-led strategy
  • Multiple format expansion (Kalamandir and Varamahalakshmi stores)
  • Previously had lower store count compared to Andhra and Telangana

Expansion Strategy

  • Cluster-led expansion model focusing on penetration with one brand followed by additional formats
  • Exploring newer markets outside current four states (potentially Maharashtra, Kerala)
  • Operating leverage through warehousing and administrative efficiencies

Competitive Landscape

  • Increased competition from exhibitions and temporary setups in function halls
  • Company countering with aggressive advertising and marketing strategies
  • Focus on maintaining competitive pricing despite raw material inflation of 5-6%

Wedding Calendar Outlook

  • Healthy pipeline of wedding dates evenly spread out
  • Majority of wedding dates falling in Q3 and partially in Q4
  • Next year (FY28) appears more promising with approximately 98 wedding days versus typical 63-65 days

Other Business Updates

  • KLM Fashion Mall format showing path to recovery with expected marked improvement
  • Valli Silks format still maturing (opened last year), evaluation ongoing
  • Investor presentation was available on company website despite minor delay