Sai Silks (Kalamandir) (KALAMANDIR) Q3 24/25 earnings summary

Executive summary

• Q3FY25 saw strong recovery driven by festive and wedding season demand, especially in Tier 2 cities, with significant improvement over previous quarters.

• One of South India's largest ethnic apparel retailers, specializing in sarees and value fashion, with a strong presence across Telangana, Karnataka, Andhra Pradesh, and Tamil Nadu.

• Operates 67 stores in 18 cities, with a combined area of 686,000 sq ft and an average revenue per store of ₹229 million in FY24.

• Diverse brand portfolio includes Kalamandir, Kanchipuram Varamahalakshmi Silks, Mandir, and KLM Fashion Mall, catering to various market segments.

• Focus on technology-driven operations, omnichannel presence, and a cluster-based expansion strategy.

• Report covers unaudited financial results for the quarter and nine months ended December 31, 2024, reviewed and approved by the Board and auditors.

Financial highlights

• Q3FY25 revenue: ₹448.56 crore (up 17.5% YoY); gross margin: 41.86% (up from 39.96% YoY); EBITDA margin: 17.59% (up from 15.22% YoY); PAT grew 43% to ₹46.02 crore.

• Nine-month revenue: ₹1,063.17 crore (up 4.86% YoY); gross margin: 41.81%; EBITDA margin: 14.41%.

• Net profit for Q3FY25 stood at ₹46.02 crore, compared to ₹31.98 crore in Q3FY24.

• Earnings per share (basic and diluted) for Q3FY25 were ₹3.12, compared to ₹2.23 in Q3FY24.

• Operating cash flow for Q3FY25 was approximately ₹45 crore; for 9M FY25, ₹38.40 crore.

Outlook and guidance

• Q4 expected to benefit from a favorable wedding calendar and new store openings, with management optimistic about sustaining growth trends.

• By FY26, gross margins are targeted to reach 43% driven by premiumization and volume discounts.

• SSSG for Q3 was 6.8%, but full-year SSSG is expected to close at neutral due to weak H1; future SSSG guidance remains at 4%-5% annually.

• IPO proceeds are being utilized for capital expenditure, working capital, debt repayment, and general corporate purposes as per the prospectus.