💰 Financial Performance

Revenue Growth by Segment

The footwear segment sold 1.7 crore pairs in FY25, a 10.5% decline from 1.9 crore pairs in FY24. However, the new toolkit segment grew from zero to represent 62% of total revenue in the first six months of fiscal 2026. Total operating income is projected to grow 62-80% YoY to INR 450-500 crore in FY26 from INR 277 crore in FY25.

Geographic Revenue Split

Domestic channels contribute 54% of footwear revenue, followed by exports at ~25% and government tenders at ~21%. Exports reach 20+ countries, with the US accounting for 22% (USD 870 million) of India's non-leather footwear exports in the 11 months of FY25.

Profitability Margins

PAT margin improved from 2.47% in FY23 to 3.29% in FY24. The company targets a stable operating margin of 9-10% for fiscal 2026, driven by higher-margin toolkit supplies and premium EVA footwear launches.

EBITDA Margin

Operating margins are projected to stabilize at 9-10% in FY26. Reported PAT was INR 6.55 crore in FY24, up 26.7% from INR 5.17 crore in FY23.

Capital Expenditure

The company raised INR 20.8 crore via a preferential issue of share warrants to fund expansion. Key investments include a new sports shoe manufacturing facility in Kundli and fully automatic injection moulding machinery for EVA footwear.

Credit Rating & Borrowing

CRISIL Ratings projects interest coverage to improve to 5.40-5.50 times in fiscal 2026. Gearing is expected to improve to 0.4-0.5 times by March 31, 2026, from 0.87 times in FY24.

⚙️ Operational Drivers

Raw Materials

Key raw materials include EVA (Ethylene Vinyl Acetate), PVC (Polyvinyl Chloride), PU (Polyurethane), and Canvas, which are essential for non-leather footwear production.

Capacity Expansion

Current operations span 4 plants in Jaipur and 1 new facility in Kundli (14,325 sq. mtr.). The Kundli plant for sports shoes is scheduled to be commercialized by July 10, 2025.

Raw Material Costs

Raw material costs are a significant portion of the cost structure; the company uses efficient procurement and BIS-certified processes to manage costs against unorganized competitors.

Manufacturing Efficiency

The company sold 1.7 crore pairs in FY25. Efficiency is being enhanced through the installation of fully automatic injection moulding machinery for EVA and Rotary Type PU machines.

Logistics & Distribution

Distribution is handled through 520+ distributors across 27 states, plus D2C channels including 2 factory outlets and large format stores like D-Mart and Reliance Retail.

📈 Strategic Growth

Expected Growth Rate

62-80%

Growth Strategy

Growth will be achieved through the full-scale execution of a INR 298 crore toolkit order under the PM Vishwakarma Scheme, entry into the high-value sports shoe segment (RANNR brand), and scaling the premium EVA footwear category (Crozi brand).

Products & Services

Non-leather footwear (slippers, sandals, school shoes, canvas shoes, sports shoes) and carpenter toolkits.

Brand Portfolio

Lehar, RANNR (Sports Shoes), Crozi (EVA Footwear).

New Products/Services

Launched 'RANNR' sports shoes and 'Crozi' single-mould EVA footwear, targeting the premium low-cost segment to improve overall portfolio value.

Market Expansion

Expanding retail footprint and distribution network across 27 states and targeting high-potential export markets like the US and UK.

Market Share & Ranking

One of North India's prominent mass-market footwear manufacturers; the industry is 70% unorganized.

Strategic Alliances

Preferred implementation partner for the National Small Industries Corporation (NSIC) for the PM Vishwakarma Scheme.

🌍 External Factors

Industry Trends

The Indian footwear market is growing at a 10.1% CAGR and is projected to reach USD 46 billion by 2033. The industry is shifting toward premiumization, digital transformation, and non-leather athletic footwear.

Competitive Landscape

Intense competition from both domestic unorganized players (70% of market) and international brands like Nike or Adidas in the athletic segment.

Competitive Moat

Durable advantages include a 30-year brand legacy ('Lehar'), early-mover advantage in the government toolkit segment, and BIS certification which acts as a barrier against unorganized competitors.

Macro Economic Sensitivity

Sensitive to rural disposable income and GDP growth; RBI projects 6.5% growth for FY26, which supports demand for affordable footwear.

Consumer Behavior

Shift toward health consciousness and active lifestyles is driving robust demand for athletic and comfort-focused footwear.

Geopolitical Risks

Trade barriers or changes in import duties on finished footwear (which the Indian government has recently raised) impact competitive dynamics.

⚖️ Regulatory & Governance

Industry Regulations

Bureau of Indian Standards (BIS) Quality Control Orders (QCOs) for polymer-based footwear became effective August 1, 2024, mandating higher product quality standards.

⚠️ Risk Analysis

Key Uncertainties

Sustainability and continuous flow of government orders for the toolkit business (62% of H1 FY26 revenue) is a critical monitorable risk.

Geographic Concentration Risk

Strong concentration in North India, though expanding to 27 states and 20+ export countries.

Third Party Dependencies

High dependency on the PM Vishwakarma Scheme and NSIC for the toolkit business segment's growth.

Technology Obsolescence Risk

Risk of failing to align with rapidly evolving fashion trends; mitigated by investing in automated injection moulding and 3D design processes.

Credit & Counterparty Risk

Working capital intensive operations with 79% bank limit utilization; mitigated by improved collection mechanisms and robust cash flows from operations.