V-Mart Retail (VMART) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 saw 13% year-on-year sales growth, with normalized same store sales growth at 5% after adjusting for Eid timing; V-Mart at 14% and Unlimited at 12%, driven by higher footfalls and a strong wedding season, though impacted by regional disruptions and early monsoon.

• EBITDA increased 27% year-over-year, reaching 14.3% of revenue; PAT rose 177% year-over-year to 3.8% of revenue.

• LimeRoad's EBITDA losses reduced by 56% year-over-year, with lower online marketing spend and improved operational efficiency.

• 15 new stores opened and 2 closed in Q1, bringing the total to 510 stores as of June 30, 2025.

• Unaudited financial results for the quarter ended June 30, 2025, were approved and released following a board meeting on July 24, 2025.

Financial highlights

• Revenue from operations for Q1 FY26 was ₹88,522 lakhs (₹8,852 million), up 13% year-over-year; V-Mart contributed 80%, Unlimited 16%, and LimeRoad 2%.

• EBITDA was ₹1,262 million (14.3% margin), up from ₹990 million (12.6% margin) year-over-year.

• PAT increased to ₹336 million (3.8% margin) from ₹121 million (1.5% margin) year-over-year; net profit for the quarter was ₹3,360 lakhs.

• Free cash flow for the quarter was ₹1,097 million, up from ₹431 million in the prior year.

• Inventory at quarter-end was INR 818 crores (93 days), a 5% improvement over last year, with aged inventory provision down to 0.7%.

Outlook and guidance

• Expecting mid- to high-single-digit same-store sales growth for the full year, with festival periods anticipated to boost performance.

• Guidance for 12%-15% net area addition and 1%-2% store closures annually remains unchanged.

• Margin strategy focuses on rupee EBITDA growth rather than percentage margin, with a conservative outlook on margin expansion.

• Lease term estimates for store leases were reassessed to align with future operating strategy, impacting ROU assets and lease liabilities.

• Management notes improved operational efficiency and continued focus on store expansion and digital integration.