Raymond Lifestyle Q2 FY26 results were broadly in line with expectations. Revenue grew 7.3% YoY to Rs 18.3 billion. Gross margin declined 121 bps YoY to 54%. Ebitda margin declined 24 bps YoY to 12.3%. Adjusted PAT declined 21.4% YoY to Rs 799 mn.
NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Systematix Report
FY25 had shown soft performance on account of weak consumer sentiments. Raymond Lifestyle Ltd.'s margins had been impacted during the period due to scale deleverage. Q1 FY26 has witnessed recovery on a low base. Q2 FY26 saw high single digit growth with improved performance in the domestic business while international business faced headwinds.
We anticipate FY26 to mark a steady recovery phase for the company with H2 FY26 benefitting from wedding and festive season. In Branded Textile, we expect revenue CAGR of 7.3% over FY25-FY28E, Ebitda margin shall expand to ~19% in FY28E from 14% in FY25.
For Branded Apparel, we project revenue CAGR of 17.2% over FY25-FY28E and operating margin expanding to 11.5% in FY28E from 7.4% in FY25. In garmenting, we anticipate revenue CAGR of 9.4% over FY25- FY28E, Ebitda margin shall expand to 9.2% in FY28E from 4.7% in FY25.
In High Value Cotton Shirting, we expect revenue CAGR of 11% over FY25-FY28E with operating margin of 11.2% by FY28E. We have factored in revenue/ Ebitda/ PAT CAGR of 11%/ 35%/ 70.7% over FY25-FY28E.
We expect operating margins of 10.3%/12.4%/ 13.6% in FY26E/FY27E/FY28E respectively.
We have revised our target price to Rs 1,638 (vs Rs 1,796 earlier) maintaining our Buy rating based on SOTP valuation method, valuing branded textiles, branded apparel and B2B businesses at 10x/ 12x/ 8x Sept 2027E EV/Ebitda.
Click on the attachment to read the full report:
Also Read: GAIL's Valuations Attractive; Tariff Hike Key Catalyst Says Motilal Oswal Maintaining 'Buy'
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
RECOMMENDED FOR YOU
Q2 Results Updates: United Breweries Profit More Than Halves; Railtel Corp Profit Up Nearly 5%
'Buy' Cyient DLM Stock Maintains Motilal Oswal Post Inline Q2 Operating Performance — Check Target Price
Tax Tweak Could Deliver Margin Bonanza For Indraprastha Gas, Says Motilal Oswal Maintaining 'Buy'
Stay 'Neutral' On Nestle Maintains Motilal Oswal On Expensive Valuations — Check Target Price
POPULAR