Campus Activewear (CAMPUS) Q2 24/25 earnings summary

Executive summary

• Achieved 28.9% year-over-year revenue growth in Q2 FY25, reaching INR 333.3 Cr, with sales volume up 36.3% to 5.4 million pairs compared to Q2 FY24.

• Expanded retail presence with nine new stores, reaching 288 exclusive brand outlets (EBOs), and launched 87 new styles, including a significant sneaker offering.

• Direct-to-consumer channels contributed 48.1% of revenue in Q2 FY25, maintaining a strong omni-channel presence.

• Board approved unaudited financial results for the quarter and half year ended 30 September 2024, with key management changes and plans for manufacturing capacity expansion at Haridwar and Ganaur.

• Key management changes: Gaurav Sharma promoted to Chief Marketing Officer; Prerna Aggarwal becomes Chief Innovation Officer.

Financial highlights

• Revenue from operations for Q2 FY25 was INR 333.3 Cr, up 28.9% YoY, but down 1.7% sequentially from Q1 FY25.

• EBITDA for Q2 FY25 stood at INR 41.6 Cr, margin at 12.5%, and PAT at INR 14.3 Cr, margin at 4.3%.

• Gross margin for Q2 FY25 was 52.8%, slightly down from 54.4% in Q2 FY24.

• Average selling price per pair was INR 622, down 5.4% YoY but up 6.3% sequentially.

• Inventory days reduced from 126 in Q2 FY24 to 110 in Q2 FY25.

Outlook and guidance

• Management expects margins to improve in H2 FY25 as promotional events and non-BIS inventory liquidation phase out.

• Full-year EBITDA margin is expected to be slightly below the earlier 17%-19% guidance due to inventory liquidation, but higher operating leverage is anticipated in H2.

• Focus on product diversification, premiumization, and expanding omni-channel experience, with plans to deepen presence in Western and Southern India and enhance offerings for women and children.

• Board approved expansion of manufacturing capacity, indicating positive business outlook.

• No specific revenue growth guidance provided, but double-digit growth is targeted, supported by improved market conditions and execution.