Key Quantitative Figures & Financial Performance

Consolidated Financials (Non-GAAP):

  • Revenue grew by 7% year-on-year (YoY).
  • EBITDA grew by 56% YoY.
  • PAT turned positive at Rs 6 crore, a significant improvement from a loss of Rs 7 crore in Q2 FY26.

GAAP Financials:

  • PAT recorded a positive swing from a loss of Rs 20 crore in Q2 FY26 to a profit of Rs 3 crore in Q2 FY27.

Operational & Segment-Wise Performance

Departmental Stores:

  • Like-for-like (LFL) business growth was 2% for the quarter. Adjusted for the festive calendar shift (Pujo moving from September to October), the LFL growth was 6.5%.
  • Total growth for departmental stores was 4%.
  • Four new departmental stores were opened in Q2 (Sindhu Bhavan-Ahmedabad, Jabalpur, Bailey Square-Patna, Jhansi), bringing the H1 FY27 total to six.
  • The full-year guidance for gross departmental store openings was increased from 9-10 to 12 stores. A seventh store is scheduled to open in Pacific Mall, Jaipur, in the next week (post-call).
  • Customer entry grew by 1% for LFL stores and 7.7% overall.
  • The premium portfolio contribution improved by 390 basis points YoY to an all-time high of 73%.
  • Average Transaction Value (ATV) increased by 9% YoY to Rs 5,471.
  • Personal Shopper program contributed 27% to revenue (a 200 bps increase YoY), generating sales of Rs 349 crore, which grew by 13% YoY. The company targets this reaching 30% of revenue by year-end.
  • Power categories outperformed: Watches (+24% YoY), Handbags (+16%), Fragrances (+13%), Footwear (+9%), Sunglasses (+8%).

First Citizen Loyalty Program:

  • Recorded the highest-ever quarterly additions with 2.5 lakh new recruitments.
  • The premium Black Card segment saw record enrollment (19,000 new) and renewals (21,000, a 66% renewal rate).
  • Total membership base grew to 14.1 million.
  • Loyalty contribution was 84% with a 68% repeat rate.
  • 37% of bills were from first-time store visitors.

Private Brands:

  • Despite reducing the number of brands and inventory by 26%, the segment saw a significant uptake in profitability.
  • The partnership with Aditya Birla Lifestyle Brands for the STOP X Peter England collaboration showed encouraging initial results.

Beauty Business:

  • The overall Beauty business (including Global SS Beauty) revenue was Rs 367 crore, registering 18% YoY growth, led by Fragrances (+35%).
  • Estée Lauder business grew by 4% LFL for the second consecutive quarter after four quarters of decline.
  • Beauty distribution business revenue was Rs 168 crore (equivalent to Rs 270 crore GMV), recording stellar growth of 59% YoY.
  • Two new beauty boutiques were opened in Q2, bringing the total to 11 (four Armani, three NARS, two Shiseido, one Prada, one Creed).

INTUNE Business:

  • Revenue was Rs 72 crore with a festive-adjusted LFL growth of 6%.
  • Inventory was reduced by Rs 33 crore YoY, now operating at a 16-week cover.
  • Repeat customer business improved to 49% (from 47% in Q1).
  • Average Bill Value (ABV) improved by 6%, and items per transaction were at 3.5.
  • EBITDA losses in new businesses (INTUNE and integrated SSBeauty.in) were reduced by Rs 8 crore in Q2 and Rs 12 crore in H1 FY27. Further reduction is expected in Q3 and Q4.

E-commerce:

  • Grew by 52% over Q2 FY26.
  • Average bill value grew by 9%, reflecting premiumization online.

Capital Allocation & Balance Sheet

  • The company continued its prudent capital allocation strategy.
  • Total inventory was optimized by Rs 78 crore YoY.
  • The company expects to be debt-free by the end of FY27, with internal accruals to be used for funding expansion in departmental stores, INTUNE, and the beauty distribution business.

Strategic Initiatives & Guidance

AI Integration:

  • Focus areas are revenue generation (personalization, consumer activation) and cost mitigation (inventory planning, demand forecasting).
  • Rolled out Personal Shopper app version 2.0 and personalization of store offerings based on shopping behavior.

Strategy Going Forward:

  • Accelerate premiumization through brand partnerships and portfolio expansion.
  • Strengthen footprint in premium malls and high-potential locations.
  • Further reduce losses in INTUNE in H2 FY27.
  • Expand the beauty distribution portfolio.
  • Maintain estimated revenue growth of mid-single to slightly higher LFL for FY27 and healthy expansion of profitability.

Q&A Session Highlights

Store Expansion: Management guidance is for 10-12 departmental store openings per year for the next 2-3 years, subject to securing the right locations and spaces. The pipeline is healthy.

INTUNE Expansion: Plans for INTUNE expansion will be shared in the Q3 earnings call after assessing Q3 performance. The current focus is on fixing operations, supply chain, and merchandising.

Festive Demand: For the ongoing festive season (Pujo and Dussehra), the company is witnessing mid-teens LFL growth. This growth is a mix of ~7% from ASP and ~8% from volume.

Beauty Business Margins: Margins in both beauty retail and distribution are healthy and sustainable. New contracts are being entered at the same or higher margins.

Rentals: The company is not experiencing significant rental inflation pressures due to its repositioning as a premium retailer and partner of choice for mall developers.