RAYMONDLSL - Raymond Lifestyl

📊 NSE: RAYMONDLSL 🏢 Textiles - Products 📅 Last Updated: 12/14/2025 11:42

💰 Financial Performance

Revenue Growth by Segment

In Q2 FY26, Branded Textile revenue grew 10% YoY to INR 937 Cr, driven by festive demand. Branded Apparel revenue grew 11% YoY in H1 FY26 to INR 826 Cr. Garmenting Export revenue grew 4% YoY to INR 269 Cr in Q2 FY26, despite international headwinds.

Geographic Revenue Split

The company operates across 600+ cities in India and 7 international markets. Domestic growth was the primary driver in Q2 FY26, while international operations faced pressure from US tariff actions.

Profitability Margins

Operating margins (PBILDT) contracted to 7.7% in FY25 from 14.3% in FY24 due to subdued demand and ransomware disruptions. However, Q2 FY26 showed recovery with an EBITDA margin of 13.9% and PBT margin of 5.8% (INR 108 Cr).

EBITDA Margin

EBITDA margin stood at 13.9% in Q2 FY26, a 7% YoY growth in absolute EBITDA to INR 259 Cr. H1 FY26 EBITDA margin improved to 11.4% from 11.1% YoY, reflecting better product mix and operating leverage.

Capital Expenditure

Planned capital expenditure for FY26 is INR 175 Cr to INR 200 Cr, primarily allocated for retail store expansion, IT infrastructure upgrades, and maintenance.

Credit Rating & Borrowing

CARE Ratings reaffirmed 'CARE AA; Stable' for long-term facilities (INR 1,500 Cr) and 'CARE A1+' for short-term facilities (INR 820 Cr) and Commercial Paper (INR 550 Cr). Interest coverage ratio stood at 2.58x in H1 FY26.

⚙️ Operational Drivers

Raw Materials

Key raw materials include Wool (comprising ~30% of raw material consumption), Cotton, and Polyester. Total raw materials account for approximately 21% of the total cost of sales.

Import Sources

Wool is primarily sourced from Australia, South Africa, the USA, and South America. Cotton is sourced from both Indian and international markets.

Capacity Expansion

Current retail footprint is 1,663 stores as of September 2025 (a net increase of 71 stores YoY). The company plans to open 600+ new stores over the next three years, focusing on the EBO network.

Raw Material Costs

Raw material costs represent ~21% of total cost of sales. The company uses a mix of forward contracts (hedging up to 6 months) and spot bookings to manage price volatility and allow for partial cost pass-through.

Manufacturing Efficiency

Efficiency is driven by an integrated 'fabric-to-fashion' model. The company is a leading producer of polywool in India, leveraging this strength to protect margins in the branded textile segment.

Logistics & Distribution

Distribution is handled through a massive network of 1,110 Raymond Shop outlets, 507 EBOs, and 51 MTM stores, reaching 600+ cities.

📈 Strategic Growth

Expected Growth Rate

12%

Growth Strategy

Growth will be achieved by expanding the retail network by 600+ stores in 3 years, scaling the Branded Apparel segment to INR 2,300-2,500 Cr to reach double-digit margins, and growing new categories like Ethnix (139 stores) and Sleepz.

Products & Services

Worsted suiting fabrics, formal wear, casual wear, ethnic wear, premium shirting, made-to-measure tailoring services, and sleepwear.

Brand Portfolio

Raymond, Park Avenue, Colorplus, Parx, Ethnix by Raymond, Sleepz by Raymond.

New Products/Services

Recently launched 'Sleepz by Raymond' in the comfort/nightwear segment. New categories (Ethnix, Sleepz, Innerwear) are expected to contribute 6-7% of total revenue in the medium term.

Market Expansion

Targeting 600+ new stores in 3 years with a focus on EBOs and expanding the MBO presence, which grew by 15% recently.

Market Share & Ranking

Dominant leader in India's branded worsted suiting segment with a 99-year track record.

Strategic Alliances

The company utilizes a franchisee-led model for retail expansion to maintain an asset-light balance sheet.

🌍 External Factors

Industry Trends

The industry is shifting toward casualisation and premiumisation. Raymond is positioning itself by expanding its 'Ethnix' and 'Sleepz' brands to capture a larger share of the evolving wardrobe needs of Indian consumers.

Competitive Landscape

Faces intense competition from organized players like Allen Solly, Louis Philippe, Van Heusen, and Siyaram, as well as unorganized local players.

Competitive Moat

Durable moat built on a 99-year brand legacy, a massive distribution network of 1,663 stores, and an integrated manufacturing setup that provides cost leadership in polywool and worsted fabrics.

Macro Economic Sensitivity

Highly sensitive to discretionary consumer spending and festive/wedding season cycles, which drive volume growth in the branded textile segment.

Consumer Behavior

Shift toward branded ethnic wear for weddings and a trend toward 'casualisation' in formal wardrobes.

Geopolitical Risks

Ongoing US-China trade tensions and US tariff announcements create uncertainty for the garmenting export business, which saw H1 FY26 revenue decline to INR 466 Cr from INR 512 Cr YoY.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to textile industry standards and import/export regulations, particularly US trade tariffs affecting the garmenting division.

Taxation Policy Impact

The company is subject to standard corporate tax rates; an income tax survey was conducted at certain facilities in September 2025.

Legal Contingencies

An income tax survey was carried out in September 2025; the company is monitoring developments. No specific case values for court disputes were disclosed.

⚠️ Risk Analysis

Key Uncertainties

US tariff impacts on exports (potential 4-5% margin hit) and the maturity timeline of 100+ newly opened stores which currently weigh on branded apparel margins.

Geographic Concentration Risk

Heavy concentration in the Indian domestic market (600+ cities), with export exposure primarily to the US and Europe.

Third Party Dependencies

Dependency on Australian and South American suppliers for high-quality wool (30% of RM).

Technology Obsolescence Risk

A ransomware incident in Q4 FY25 caused operational disruptions, highlighting the need for the planned IT infrastructure investment of INR 175-200 Cr.