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Aditya Birla Fashion and Retail Limited — Q2 FY25
ABFRL reported Q2FY25 consolidated revenue of INR 3,644 crore (+13% YoY) and EBITDA of INR 410 crore (+11% YoY) with an 11.2% margin.
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ABFRL reported Q2FY25 consolidated revenue of INR 3,644 crore (+13% YoY) and EBITDA of INR 410 crore (+11% YoY) with an 11.2% margin. PAT was negative INR 215 crore due to higher depreciation and interest from TCNS consolidation. The demand environment remained subdued, but festive and wedding spending provided some uplift. Pantaloons delivered a standout performance with EBITDA margin expanding 560 bps YoY to 15%, driven by tight discount control and cost efficiencies. The ethnic business grew 3x YoY to INR 454 crore, aided by TCNS and Tarun Tahiliani. TMRW more than doubled revenue. Management expects improved H2 conditions and plans to complete the demerger by year-end. Risk: sustained weakness in smaller markets could pressure like-to-like growth.
ABFRL ने Q2FY25 में 3,644 करोड़ रुपये की कमाई की, जो पिछले साल से 13% ज्यादा है। कंपनी ने 410 करोड़ रुपये का EBITDA कमाया, जो 11% ज्यादा है और मार्जिन 11.2% रहा। लेकिन कंपनी को 215 करोड़ रुपये का घाटा हुआ, क्योंकि TCNS के विलय से ज्यादा डेप्रिसिएशन और ब्याज खर्च बढ़ा। बाजार में मांग कमजोर रही, लेकिन त्योहारों और शादियों ने कुछ मदद की। Pantaloons ने शानदार प्रदर्शन किया, जहां मार्जिन 15% तक पहुंच गया, क्योंकि डिस्काउंट पर कड़ी नियंत्रण और लागत बचत हुई। एथनिक बिजनेस तीन गुना बढ़कर 454 करोड़ रुपये हो गया। TMRW का रेवेन्यू दोगुना से ज्यादा हुआ। कंपनी को दूसरी छमाही में बेहतर स्थिति की उम्मीद है और साल के अंत तक डीमर्जर पूरा करने की योजना है। छोटे बाजारों में कमजोरी से बिक्री पर दबाव पड़ सकता है।
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Weak demand in smaller markets
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Pantaloons EBITDA margin
15%
+560bps YoY
Pantaloons EBITDA margin expanded significantly due to better planning and cost control.
Ethnic business revenue
INR 454 crore
+3x YoY
Ethnic business grew more than three times, driven by TCNS and Tarun Tahiliani.
TMRW revenue growth
>100% YoY
+100%+ YoY
TMRW portfolio more than doubled, including inorganic growth from TIGC.
Net debt
INR 3,759 crore
+INR 800-900 crore H1
Net debt increased due to investments in ethnic business and acquisitions.
What Changed vs Last Quarter
NEW
TCNS to break even by Q3FY25
TCNS business is on track to become profitable in Q3FY25, with improving product quality and margins.
NEW
Debt reduction of INR 400-500 crore in H2
Management expects net debt to reduce by INR 400-500 crore in the second half due to seasonal sales pickup.
NEW
Lifestyle brands double-digit CAGR growth
Management expects lifestyle brands to sustain double-digit revenue CAGR over the long term.
UPDATED
Pantaloons store expansion of 20-25 stores per year
Pantaloons plans to open 20-25 stores annually, focusing on larger stores in urban and Tier 1 markets.
DROPPED
TCNS to turn EBITDA positive in H2 FY25
Management expects TCNS to become profitable in the second half of FY25 as inventory corrections are largely complete.
DROPPED
Demerger completion by end of FY25
The demerger of the branded business is expected to be completed by end of fiscal year 2025.
NEW RISK
Weak demand in smaller markets
Smaller markets continue to underperform, pressuring like-to-like growth for Pantaloons and lifestyle brands.
NEW RISK
Impact of warm October on winter sales
An analyst raised concern about warm weather affecting winter portfolio; management downplayed but acknowledged risk.
NEW RISK
High debt and interest burden
Net debt of INR 3,759 crore and elevated interest costs are impacting PAT, especially in H1.
NEW RISK
Franchisee stress limiting expansion
Franchisee partners are cautious due to prolonged demand weakness, slowing store additions in smaller towns.
RISK GONE
Weak demand environment may persist
Consumer spending remains subdued due to a weak wedding season and heat wave; recovery is dependent on H2 festive season.
RISK GONE
TCNS turnaround may take longer
TCNS losses have been higher than expected; management acknowledged that full recovery to historical margins may take 12-18 months.
RISK GONE
TMRW losses increasing
TMRW losses have increased sequentially, and management paused acquisitions until fundraising is completed.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q1 FY25, Q2 FY24, Q3 FY24
Pantaloons plans to add 20-25 stores in FY25, with expansion back-ended.
Mentioned in Q2 FY24, Q3 FY24, Q4 FY24
TCNS posted losses (EBITDA -INR 41 crore in 6 months) and revenue declined 21% YoY in Q4 due to distribution rationalization.
Mentioned in Q1 FY24, Q2 FY24
Management reiterated debt guidance of INR 2,700-2,800 crore by end of FY24, including GIC warrant proceeds of ~INR 1,400 crore expected by March.
Mentioned in Q1 FY25, Q4 FY24
The demerger of the branded business is expected to be completed by end of fiscal year 2025.
Mentioned in Q2 FY24, Q4 FY24
The innerwear business remains unprofitable due to athleisure decline, with only intermittent quarterly profits.
Fast read
Guidance and risk preview
TCNS business is on track to become profitable in Q3FY25, with improving product quality and margins.
Smaller markets continue to underperform, pressuring like-to-like growth for Pantaloons and lifestyle brands.
View Risks →