V2 Retail (V2RETAIL) Q1 24/25 earnings summary

Executive summary

• Achieved highest-ever quarterly sales in Q1 FY25, with revenue reaching ₹415 crore, a 57% year-over-year increase, and PAT up 162% to ₹16.34 crore.

• Opened 10 new stores, bringing the total to 127, with plans to add 40-50 more in FY25, focusing on underserved urban and rural markets.

• Strategic focus on private labels, now at 80% of sales, targeting 100% in the next 1-2 years.

• Sales per square foot per month increased to ₹1,059 in Q1 FY25 from ₹798 in Q1 FY24.

• Unaudited standalone and consolidated financial results for Q1 FY25 were reviewed and approved by the Board on 30 July 2024.

Financial highlights

• Revenue from operations for Q1 FY25 was ₹41,503.29 lakhs, up from ₹26,360.73 lakhs in Q1 FY24.

• EBITDA for Q1 FY25 stood at ₹55.5 crore, up 56% year-over-year, with EBITDA margin at 13.4%.

• PAT margin improved to 3.9% in Q1 FY25 from 2.4% in Q1 FY24.

• Basic and diluted EPS for Q1 FY25 stood at ₹4.59 (standalone) and ₹4.72 (consolidated), up from ₹1.42 and ₹1.81 respectively in Q1 FY24.

• Inventory at the end of June was INR 439 crore, with payables at INR 251 crore.

Outlook and guidance

• Targeting 30%-40% revenue growth and 4.5% PAT margin for FY25.

• Pre-Ind AS EBITDA margin targeted at 7%-8% for FY25, rising to 8%-9% in future years.

• ROE expected to be around 20%-22%.

• Same-store sales growth guidance of 15%-20% for the next nine months, with a long-term target of 10%.

• Management is confident about the recoverability of a significant advance related to an advertisement contract, expecting further extension of the agreement.