Q1 2027 Raymond Lifestyle Ltd Earnings Call Transcript
Key Points
- Raymond Lifestyle Ltd (BOM:544240) reported a 6% year-on-year revenue growth to INR1,560 crores in Q1 FY27, with EBITDA up 11% to INR135 crores and a 40 bps margin expansion to 8.6%.
- The company maintained a debt-free balance sheet with a net cash surplus of INR154 crore in June 2026, a significant INR209 crore improvement from a net debt position a year earlier.
- Garmenting segment delivered stellar performance with 50% YoY revenue growth to INR296 crores, driven by US-India tariff rationalization and new client acquisitions from Europe and UK, turning EBITDA positive at INR22 crores.
- The company is strategically expanding into new markets, with new clients like Next (UK), El Corte Ingles (Spain), OVS (Italy), and Karl Gross (Germany), and has a full order book through December 2026.
- Net working capital days improved by 15 days to 75 days, and the company is actively optimizing its store footprint by closing 133 underperforming stores and opening 85 high-yielding locations.
- The loyalty ecosystem reached 12.4 million members, supporting data-driven marketing and lower customer acquisition costs.
- Management is confident in future growth, citing a strong H2 outlook with festive season demand and a strategic focus on premiumization and casualization to drive margins.
- Branded Textiles revenue declined to INR684 crores from INR699 crores due to base effects from the previous year's IT issues, leading to scale deleverage and lower EBITDA margins.
- Branded Apparel EBITDA margin was impacted at 5.1% due to an adverse channel mix, despite growth in e-commerce and LFS channels.
- The company faces significant raw material cost inflation, with wool prices up 100%, cotton and flax up 20%, and chemicals up 30% year-on-year, pressuring margins.
- The retail network is still in a consolidation phase, with net store closures expected to continue for another 2-3 quarters, which will temporarily impact sales growth.
- Macroeconomic headwinds include geopolitical tensions, currency volatility, and a subpar monsoon, which could dampen discretionary spending in the domestic market.
- The company is facing a challenging first half due to the Adhik Maas period, which delayed festive and wedding purchases, impacting product mix and margins.
- Management refrained from providing long-term guidance due to unpredictable international trade dynamics, citing potential disruptions from geopolitical events.
Ladies and gentlemen, good day and welcome to Raymond Lifestyle Limited Q1 FY27 earnings conference call hosted by Motilal Oswal Financial Services.
(Operator Instructions)
Please note this conference is being recorded.
I now have the conference. Over to Mr. Avinash Karumanchi from Motilal Oswal Financial Services.
Thank you and over to you, sir.
Thank you, team. On behalf of Motilal Oswal Financial Services, I would like to welcome all the participants to Q1 FY27 conference call of Raymond Lifestyle Limited. Today, we have with us from the senior management of Raymond Lifestyle, Mr. Satyaki Ghosh, Chief Executive Officer, Mr. E.C. Prasad, Chief Financial Officer, and Mr. Sunny Desa, Investor Relations. Without taking further time, I would like to hand over the call to Mr. Satyaki Ghosh. Over to you, sir.
Good afternoon,
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