💰 Financial Performance

Revenue Growth by Segment

Overall revenue for H1 FY26 reached INR 26,704 million, a 3.3% YoY growth. Q2 FY26 revenue was INR 12,909 million, up 3.6% YoY. While specific segment-wise revenue splits were not provided, sales volume grew by 2.2% in H1 FY26 (115.2 million pieces) and 2.5% in Q2 FY26 (56.6 million pieces), indicating that growth is driven by volume increases in the core innerwear and leisurewear categories.

Geographic Revenue Split

Not disclosed in available documents, though the company operates a pan-India multi-channel distribution network across MBO, EBO, LFS, and E-Commerce channels.

Profitability Margins

Gross margins have remained robust due to stable raw material costs. PAT for H1 FY26 was INR 3,956 million (15.2% margin), representing a 9.7% YoY growth. However, Q2 FY26 PAT was INR 1,948 million (15.1% margin), a marginal decline of 0.3% YoY due to higher employee and marketing expenses.

EBITDA Margin

EBITDA margin for H1 FY26 was 22.0% (INR 5,742 million), up from 20.8% in H1 FY25, a 9.4% YoY increase. Q2 FY26 EBITDA margin was 21.7% (INR 2,795 million), a slight decline from 22.4% in Q2 FY25. The company targets a sustainable EBITDA range of 19% to 21% through cost optimization and operational efficiencies.

Capital Expenditure

Planned capital expenditure is approximately INR 180-230 crore as of recent fiscal cycles to support manufacturing expansion and distribution network strengthening.

Credit Rating & Borrowing

ICRA reaffirmed [ICRA]AA+ (Stable) for long-term fund-based facilities and [ICRA]A1+ for short-term non-fund based facilities as of October 2025. Total rated bank lines amount to INR 350 crore. The company maintains a strong balance sheet with no term debt obligations and access to significant unutilized working capital limits.

⚙️ Operational Drivers

Raw Materials

The primary raw materials include cotton yarn and elastic (implied by innerwear manufacturing). Raw material costs are currently stable, which has allowed the company to maintain gross margins without taking price hikes.

Import Sources

The company sources materials from world-class suppliers, including imports for specific high-quality requirements to maintain consistent product standards.

Capacity Expansion

The company operates multiple manufacturing units (Units 1 through 28 mentioned in safety certifications). It recently achieved a 16% increase in output through productivity improvements despite a 10% reduction in headcount.

Raw Material Costs

Raw material costs have remained stable, aiding gross margin expansion. The company strategically built inventory to mitigate potential price fluctuations, contributing to a robust gross margin even as product prices remained unchanged in Q2 FY26.

Manufacturing Efficiency

Significant efficiency gains reported: 16% increase in output with 10% fewer people. The company is focusing on 'doing more with less' to manage overheads effectively.

Logistics & Distribution

The company utilizes a pan-India multi-channel network including E-commerce and Quick Commerce, which is seeing robust growth in metros.

📈 Strategic Growth

Expected Growth Rate

10%+

Growth Strategy

Growth will be achieved through a 'double-digit' target driven by market dominance in the premium innerwear segment, expansion of the distribution network, and product innovation. The company is focusing on 'Quick Commerce' for metro growth and expanding its EBO (Exclusive Brand Store) footprint with a new identity.

Products & Services

Men's innerwear, women's innerwear (bras), leisurewear, and socks.

Brand Portfolio

Jockey (exclusive license in India, Sri Lanka, Bangladesh, Nepal, and UAE until 2040) and Speedo.

New Products/Services

Launched an innovative product range featuring 'bonded technology' in men's innerwear and bras in September 2025, which received encouraging initial consumer response.

Market Expansion

Expansion is focused on increasing penetration in existing cities and scaling up in new geographies through a multi-channel approach (MBO, EBO, LFS).

Market Share & Ranking

The company holds a leading position in the domestic premium innerwear market, though management noted a slight penetration shift from 19-20% down to 17.5-18% in specific portfolio areas.

Strategic Alliances

Long-term licensing agreement with Jockey International through 2040.

🌍 External Factors

Industry Trends

The innerwear industry is evolving with a shift toward premiumization and digital/quick commerce. While the overall retail demand for branded apparel has seen a slowdown, the company is positioning itself to capture the recovery through product innovation and distribution reach.

Competitive Landscape

Faces competition from other branded innerwear players and premium international brands. Market share has seen slight pressure, moving from 19-20% to approximately 17.5-18%.

Competitive Moat

The primary moat is the 'Jockey' brand equity and a massive distribution network. This is supported by industry-leading ROCE (50-70% range) and a license valid until 2040, providing long-term stability and competitive advantage over newer entrants.

Macro Economic Sensitivity

Highly sensitive to consumer discretionary spending. Subdued consumption trends impacted Q2 FY26 revenue growth. Management expects GST 2.0 and reduced lending rates to provide a positive impetus for future demand.

Consumer Behavior

Increasing preference for online shopping and quick commerce in metros is a key trend. Consumers are also responding well to 'bonded technology' and innovative fabrications.

⚖️ Regulatory & Governance

Industry Regulations

Complies with manufacturing standards and safety health environment (SHE) initiatives. The company is working toward various levels of '5S' certification across its units (Basic to Model Level).

Environmental Compliance

The company follows an Integrated Management System (IMS) for environmental responsibility and has received safety awards from the Karnataka Safety Institute.

Taxation Policy Impact

Effective tax rate is approximately 25% (implied by PBT of INR 5,313 Mn and PAT of INR 3,956 Mn for H1 FY26).

⚠️ Risk Analysis

Key Uncertainties

Volatility in raw material prices and minimum wage increases could impact the target EBITDA margin of 19-21%. Subdued demand in the innerwear segment remains a primary risk to achieving double-digit growth.

Geographic Concentration Risk

Not disclosed in available documents, but the company has a pan-India presence.

Third Party Dependencies

High dependency on the Jockey International license, which is secured until 2040.

Technology Obsolescence Risk

The company is mitigating technology risks by investing in new manufacturing technologies like 'bonded technology' to stay ahead of market trends.

Credit & Counterparty Risk

Receivables management is efficient, with receivables days historically low (around 11-19 days), indicating high quality of receivables and low credit risk.