Cantabil Retail India reports a promising first quarter with 13% revenue growth and plans to more than double store openings to reach ₹1,000 crore in FY27, amid a focus on physical growth and digital enhancements.
Cantabil Retail India said its first-quarter performance for FY27 showed steady demand, even as the apparel retailer pressed ahead with an ambitious expansion plan aimed at lifting annual revenue to ₹1,000 crore. In the earnings commentary covered by GuruFocus, the company reported revenue of ₹178.8 crore, up 13% year on year, while EBITDA rose 21% and the EBITDA margin widened to 33.2%. Same-store sales growth was 4.04%, a sign that existing outlets continued to generate healthy footfall and spend.
Management struck a confident tone on the full-year outlook, pointing to a sharp step-up in store openings in the second quarter. Whole-time director Deepak Bansal said the company opened about 27,000 square feet in the first quarter and expected 55,000 to 60,000 square feet in the second, more than doubling the pace. The retailer is also targeting around 5% same-store sales growth for the year, while chief financial officer Shivendra Nigam said the company remains on track to maintain a 50% gross margin on average over the year.
The first quarter was not without pressure points. Profit after tax margin slipped slightly to 9.1% from 9.2% a year earlier, even as revenue increased. Management attributed some of the strain to higher raw material costs, which it said were running about 10% to 15% above prior levels, and to a wage increase in Haryana, where the company’s factory is based. Nigam said the full impact of the wage rise had already been absorbed in the quarter.
Cantabil’s growth model remains heavily tied to physical expansion, but the company is also trying to lift productivity through larger stores and a better online mix. The average size of newly opened stores in the quarter was 1,810 square feet, up from about 1,300 square feet a year earlier. Online sales contributed about 5% of revenue in the quarter, below the company’s annual goal of 8% because of software integration issues. Bansal said the business is reviewing its digital marketing approach and may revisit a loyalty programme, although it has not committed to one.
The retailer’s broader financial profile has strengthened over the past year. Analysts at Arthneeti noted that Cantabil ended FY26 with revenue of ₹852.6 crore, up 18%, and EBITDA margin of 31%, while Franchise India reported FY26 net profit of ₹95.8 crore and a retail network of 652 stores. Against that backdrop, the new target of ₹1,000 crore for FY27 implies another strong year of growth, but one that will depend on sustained store additions, better festive-season demand and improved inventory discipline. Nigam said inventory days fell to 114 in FY26 from 121 in FY25, with a further reduction to 110 days now in sight.
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