Sai Silks (Kalamandir) (KALAMANDIR) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 was impacted by a 70% reduction in wedding dates, extreme heatwave, and national elections, leading to weak consumer walk-ins and a 20% decline in footfalls year-over-year.

• Operates 61 stores in 15 cities under four brands, serving 6.77 million customers and generating an average revenue per store of ₹229 million in FY24.

• Unaudited financial results for Q1 FY25 were reviewed and approved by the Board on August 14, 2024, with statutory auditors issuing an unmodified review report.

• Focuses on innovative designs, technology-driven supply chain, and a cluster-based expansion model for targeted growth.

• One new store was opened in Q1, bringing total retail area to 653,000 sq ft across 61 stores in 4 states.

Financial highlights

• Q1 FY25 revenue was ₹267.29 crore, down 12.25% year-over-year, with gross margin at 41.26%, up from 40.29% in Q1 FY24.

• EBITDA for Q1 FY25 was ₹18.92 crore (7.08% margin), down from ₹44.63 crore (14.65% margin) in Q1 FY24.

• PAT for Q1 FY25 was ₹2.09 crore (0.78% margin), a significant decline from ₹16.79 crore (5.51% margin) in Q1 FY24.

• Working capital debt reduced to INR 150 crore and total debt to INR 180 crore as of June end.

• Interest cost expected to halve to INR 18-19 crore for FY25.

Outlook and guidance

• Q2 is expected to see a rebound with higher wedding dates, improved footfalls, and positive SSG trends.

• H1 FY25 is projected to be at least flat or slightly better than H1 FY24 in both sales and EBITDA.

• Full-year net profit guidance of INR 150 crore will be reassessed after Q2, with management optimistic about recovery.

• Store expansion target of 90,000 sq ft for FY25 remains, with most openings shifted to Q2-Q4.

• Long-term plan is to add 10-15% retail area annually, targeting 100 stores and INR 28,000-28,500 per sq ft revenue by FY26.