Relaxo Footwears (RELAXO) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 revenue declined 7.5% year-over-year to ₹629 crore, mainly due to demand softness and delayed purchases ahead of GST 2.2 implementation.

• H1 FY26 revenue was ₹1,283 crore, down from ₹1,428 crore in H1 FY25; number of pairs sold in Q2 FY26 was 4.1 crore, with average realization per pair at ₹151.

• Gradual demand revival is underway post-GST rollout, with general trade channels showing recovery and contributing the highest share to sales.

• The company remains optimistic about recovery, expecting momentum to strengthen in the coming quarters, supported by festival demand, GST benefits, and sales transformation initiatives.

• Unaudited financial results for the quarter and half year ended September 30, 2025, were approved and reviewed by the Board and auditors, with no material misstatements noted.

Financial highlights

• Q2 FY26 EBITDA was ₹81 crore, with a stable EBITDA margin of 12.9%; Q2 FY26 PAT was ₹36 crore, nearly flat year-over-year, with PAT margin improving to 5.8%.

• H1 FY26 EBITDA was ₹181 crore, with margin expanding by 101 bps to 14.1%; H1 FY26 PAT was ₹85 crore, up 4.9% year-over-year, with PAT margin improving to 6.6%.

• Profit before tax for Q2 FY26 was ₹48.85 crore, compared to ₹49.57 crore in Q2 FY25; H1 FY26 profit before tax was ₹114.76 crore, up from ₹109.90 crore year-over-year.

• Annual FY25 revenue was ₹2,790 crore, with EBITDA margin at 12.1% and PAT margin at 6.1%.

• Other income increased due to a higher treasury base and hedging gains; similar levels expected going forward.

Outlook and guidance

• Management expects growth to return in Q4 FY26, with next year anticipated to be much better as GST reduction boosts competitiveness.

• Indian footwear market expected to grow at 10.1% CAGR through 2033, outpacing Asia-Pacific and global averages.

• Organised segment projected to increase its share from 35% to 45% by 2034.

• Volume-led growth, market share expansion, and sustainable profitability remain strategic priorities.

• CapEx guidance is ₹100–150 crore for this year and next, focused on operational efficiency, warehouse modernization, and maintenance.