DOLLARNSEAugust 12, 2025

Dollar Industries Limited

7,040words
107turns
10analyst exchanges
4executives
Management on call
Ankit Gupta
PRESIDENT, MARKETING – DOLLAR INDUSTRIES LIMITED
Gaurav Gupta
VICE PRESIDENT,
Ajay Patodia
CHIEF FINANCIAL
Sumant Kumar
MOTILAL OSWAL FINANCIAL SERVICES
Key numbers — 40 extracted
rs,
ational highlights for Q1 FY '26, we would like to express our sincere gratitude to our shareholders, analysts and stakeholders for joining us today. Your continued support and engagement remains inva
108 billion
re. The outlook for the Indian apparel industry remains strong with its market size estimated at $108 billion in FY '25, and it's expected to grow at a healthy 9% CAGR until FY '31. This momentum is being dr
9%
with its market size estimated at $108 billion in FY '25, and it's expected to grow at a healthy 9% CAGR until FY '31. This momentum is being driven by rising incomes, higher discretionary spending
INR399 crore
trend, we have delivered a strong start to the year with operating income for Q1 FY '26 reaching INR399 crores, representing a healthy 19.6% year-on-year growth. Volumes increased by 18.7% compared to Q1 FY
19.6%
rt to the year with operating income for Q1 FY '26 reaching INR399 crores, representing a healthy 19.6% year-on-year growth. Volumes increased by 18.7% compared to Q1 FY '25.
18.7%
26 reaching INR399 crores, representing a healthy 19.6% year-on-year growth. Volumes increased by 18.7% compared to Q1 FY '25. Our premium segment continued their strong g
24.0%
Our premium segment continued their strong growth trajectory, delivering 24.0% year-on-year value growth and 19.4% year-on-year volume growth with the average selling price ris
19.4%
segment continued their strong growth trajectory, delivering 24.0% year-on-year value growth and 19.4% year-on-year volume growth with the average selling price rising 3.8% year-on-year. Force NXT rec
3.8%
r-on-year value growth and 19.4% year-on-year volume growth with the average selling price rising 3.8% year-on-year. Force NXT recorded 21.5% year-on-year value growth and 18.0% year-on-year volume
21.5%
on-year volume growth with the average selling price rising 3.8% year-on-year. Force NXT recorded 21.5% year-on-year value growth and 18.0% year-on-year volume growth. Our athleisure segment grew 14.
18.0%
ge selling price rising 3.8% year-on-year. Force NXT recorded 21.5% year-on-year value growth and 18.0% year-on-year volume growth. Our athleisure segment grew 14.3% year-on-year, reflecting strong d
14.3%
.5% year-on-year value growth and 18.0% year-on-year volume growth. Our athleisure segment grew 14.3% year-on-year, reflecting strong demand for versatile apparel. India's athleisure market valued at
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Guidance — 20 items
Ankit Gupta
opening
“The outlook for the Indian apparel industry remains strong with its market size estimated at $108 billion in FY '25, and it's expected to grow at a healthy 9% CAGR until FY '31.”
Ankit Gupta
opening
“India's athleisure market valued at $13.15 billion in 2024 is projected to grow at 5.5% CAGR, indicating a promising long-term opportunity.”
Ankit Gupta
opening
“Additionally, stable raw material prices are expected to support and further strengthen our margins going forward.”
Gaurav Gupta
opening
“We plan to introduce a broader product range under the JV in the coming months to further enhance our portfolio and strengthen our market presence.”
Ajay Patodia
opening
“The free cash flow generated from operations will be directed towards debt repayment, resulting in lower finance costs and improved profitability.”
Divanyash Thakur
qa
“So, I had a question regarding Project Lakshya.”
Divanyash Thakur
qa
“So, Project Lakshya contributed 26% in fiscal year '24 and 30% in fiscal year '25.”
Divanyash Thakur
qa
“You have said that you target about 70% contribution by fiscal year '26, supported by expansion into Madhya Pradesh and Jharkhand.”
Ankit Gupta
qa
“So in Q1 FY '26, our overall contribution coming in from Lakshya Project was 32% of our total revenue without any increase in the number of distributors.”
Ankit Gupta
qa
“And therefore, in order to save the market share or the shelf space at the MBO point, we have slowed down, paced it a bit down the implementation of this project.”
Risks & concerns — 5 flagged
So to comment anything in regard if it has actually benefited us in numbers will be a very difficult thing to tell.
— Gaurav Gupta
So it would be very difficult to actually commit or give guideline on the same.
— Ankit Gupta
So we hope that we'll be able to crack, because it's very difficult to enter a market where -- so in the African market, there's a lot of counterfeit product that sells.
— Ankit Gupta
And what would be the impact of this increasing impact on your top line?
— Anik Mitra
So the amount we are bleeding is almost negligible, but finding new franchisees for the stores is getting difficult.
— Ankit Gupta
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Q&A — 10 exchanges
Q
First of all, congratulations on the great results. So, I had a question regarding Project Lakshya. So, Project Lakshya contributed 26% in fiscal year '24 and 30% in fiscal year '25. You have said that you target about 70% contribution by fiscal year '26, supported by expansion into Madhya Pradesh and Jharkhand. So what are your company's plans or strategies to reach this goal, if you can further…?
Ankit Gupta
So in Q1 FY '26, our overall contribution coming in from Lakshya Project was 32% of our total revenue without any increase in the number of distributors. Like I said in the earlier call also, like a call before like year-end call, earnings call, the thing is that due to the intensive competition into the market and with this particular project, it really disrupts the market for a time being. And therefore, in order to save the market share or the shelf space at the MBO point, we have slowed down, paced it a bit down the implementation of this project. Currently, we are not very aggressive in t
Q
Yes. Actually, I have two questions. So first question is around e-commerce. So what have you done differently over the last 1 or 2 years for the uptick of modern trade and e-commerce channels? That's one. Second is roping in large stars like Mahesh Babu for South India, South India promotion, has it shown any goodness? And how are we reaching that?
Ankit Gupta
So Gaurav, do you want to take this? So in e-commerce, what we have done is we have really driven deep into the various portals that are available, say, Myntra, Flipkart, Amazon, we have decided to tie up and kind of penetrating all the kind of business models that they have, to reach the customer and reduce the TAT, because in today's world, what happens is the customer is not ready to wait for the product. So they have got different models and different warehouses across India where your product, if it is made available, it reaches the customer at a faster pace. So we have explored that segm
Q
Sir, a few -- like in last week, your competitor reported Page Industries. And they highlighted that overall industry trends have remained very sluggish. In fact, they themselves saw a very steep moderation. And you have grown 19%. I was looking at Lux Industries' number, they have grown at 12%. So just wanted to understand overall industry, like have the competitors exited some markets, which has resulted in you gaining shelf space? Are consumers down trading from higher premium levels to mid-premium levels? Have you seen any increase in receivables this quarter? Just some color on the overal
Ankit Gupta
So see, one thing we need to understand that Page operates in a very different market segment. Their target consumer is very different from our target consumers. And if you see Page Industries, they mainly sell through their EBOs, large-format stores, which is like modern retail, what we call. A great percentage of their sales comes from organized channel and not from trade channel. But in our case, mostly our sales comes from trade channel and very less like around 10% to 12% from modern channel, like organized retail, I would say. So there's no down trading happening in the market. Yes, mayb
Q
Sir, my first question is that in the fourth quarter, we did have some additional discounting, which was being done by the industry. Has this discounting started reducing or the intensity still continues to be very high?
Ankit Gupta
Bhargavji, the thing is that the competition is still intense in the market. And the thing is that the discounting that we -- the extra schemes and incentives that were given in quarter 4, it has started reducing but not up to an optimum level where we would be telling that we are satisfied with the pricing levels. It is yet to come down. And gradually, I think in a couple of quarters, we should see some changes happening. Okay. Secondly, sir, we've reduced the debt by about INR51-odd crores in this quarter. Is it fair to assume that by the year-end, we can reduce about INR100-odd crores given
Q
As you have made INR16.5 crores export revenue in Q1 across 15 countries. So what category are you targeting for export in next 2 or 3 years? And are there any specific geographies you are prioritizing and looking for in your geography?
Ankit Gupta
So we have always been strong in the Gulf market. But the newer market that we are trying to enter and increase our overall export is the African market and Myanmar, Burma. So we have very recently, like last year only, we started off with African market and Burma exports as well. So we hope that we'll be able to crack, because it's very difficult to enter a market where -- so in the African market, there's a lot of counterfeit product that sells. There's a lot of private labels. So there's a cost constraint also in order to enter into the particular market. So we are very hopeful that we'll b
Q
Congratulations on a good set of numbers. So I have a question. I just want to understand, since the cotton forms a major part of your raw material, how has been the trend in the cotton prices till date? And how should we expect it to evolve going ahead?
Ankit Gupta
Sorry, we didn't get your question. So I was asking that since cotton forms a major part of our raw material, how has been the trend in cotton prices till date? And how should we expect it to evolve going ahead? Currently, cotton market is very stable. And from last 6 months, average cotton price is stable between INR55,000 to INR56,000. And as per current guidelines, the agriculture for cotton crop is also very good. And we hope that there is no fluctuation in the market with regard to cotton prices. And it is stable for next 6 to 12 months. Okay. And as you said that you expect the price to
Q
Sir, my first question is regarding EBOs. Sir, in FY '25, you have given a target of 125 EBOs. And in FY '24 and '25, we have seen that you have 17 EBOs. And once again, you have given 125 EBOs target by FY '26. So I just want to understand how do you achieve this number? What would be the strategy behind like achieving this 125 EBOs from 17 currently? And what would be the impact of this increasing impact on your top line?
Ankit Gupta
So, Mr. Anik, the thing is that during last year only, we said that we are not opening any EBO and we won't be able to open 125 EBOs by FY '26 also because the basic problem still persists that the exclusive brand outlets that we have, the ASPs are very low and the per ticket value is that we are getting right now is not feasible and it's bleeding, right? So up to a certain level, we are able to optimize. Also we are treating it as a white elephant, like it is more of an experience store for our consumer and it's a permanent hoarding of our brand, which is there. And we are compensating our fr
Q
Sir, just continuing on one conversation on the advertisement expenses. If you look at your annual report last year, you have advertisement expenses of approximately INR100 crores and you also have commission and brokerage of around INR30.5 crores and you have got sales promotion expenses are around INR14 crores and you have got other selling and distribution expenses of INR35 crores. Sir, how do you classify among these four? And if I compare with your peer group, all this combined together, you have got a very high proportionate percentage of sales. How do you think about it? And also going
Ajay Patodia
Yes. With respect to advertisement expenses, means that we classify all the ATL and BTL activity, like electronic media and like in-store branding. But with regard to commission, if the commission is paid on sales and on purchase also. So when we procure yarn, then there is a commission. When we sell our product, then we have the system of the delivery agent. So we have to pay the commission from 1.5% to 1.75% of our sales. With regard to sales promotion expenses, they are the expenses which are -- we organize conference for our dealers and distributors time to time and promote and selling exp
Q
Sir, I just wanted to understand the competitive intensity in the industry, given that 19% growth that you have done during the quarter, is there any base effect or easing of competitive intensity? Or how should we read this number?
Ankit Gupta
So Prerna, the competition is still intense in the market, although it's not as intense as it was in Q4, but the intensity is still there. And 19.5% kind of a growth that we have done is the hard work of our sales team and the distributor and the trade channel. And plus the model -- the support that we got from the e-commerce, quick commerce and the modern retail, we have seen 82% kind of a growth in our modern trade sales. So e-commerce has also helped us a lot in increasing our overall sales. Okay. Just a follow-up. Will that be meaningful to our overall numbers when we look at the 12% volum
Q
I would like to thank you all for taking the time out to join the earnings call. Have a nice day. Thank you.
Ajay Patodia
Thank you. Thank you so much.
Speaking time
Ankit Gupta
32
Ajay Patodia
15
Moderator
12
Bhargav
9
Naman
7
Prerna Jhunjhunwala
7
Pulavarthi Sai Kiran
5
Gaurav Gupta
4
Deepali Kumari
4
Anik Mitra
4
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Opening remarks
Sumant Kumar
Thank you. Good evening, everyone, and very warm welcome to Dollar Industries Q1 FY '26 post results earnings call, hosted by Motilal Oswal Finance Services Limited. On the call today, we have management team being represented by Mr. Ankit Gupta, President, Marketing; Mr. Gaurav Gupta, Vice President, Strategy; and Mr. Ajay Patodia, CFO. We'll begin the call with key thoughts from the management team. Thereafter, we'll open the floor for the Q&A session. I would now like to request the management team to share their perspective on the performance of the company. Thank you, and over to the management team. Thank you.
Ankit Gupta
Thank you, Sumant. Good afternoon, everyone, and a warm welcome to you all. Thank you for joining us today for the Dollar Industries Q1 FY '26 earnings investor call. Gaurav and I will walk you through the business and operational highlights of the quarter, while our CFO, Mr. Ajay Patodia, will share the financial metrics. Before we move into the financial results and operational highlights for Q1 FY '26, we would like to express our sincere gratitude to our shareholders, analysts and stakeholders for joining us today. Your continued support and engagement remains invaluable as we navigate both the opportunities and challenges within our industry. We would also like to draw your attention to the Safe Harbor statement included in the earnings call presentation. We request all participants to review it before the Q&A session begins. Let me start with the broader picture. The outlook for the Indian apparel industry remains strong with its market size estimated at $108 billion in FY '25, a
Gaurav Gupta
Thank you, Ankit. In quarter 1 FY '26, Dollar Industries modern trade, e-commerce and quick commerce channels delivered strong momentum, recording value growth of 65.2% and volume growth of 82.0% year-on-year. These channels contributed to 12.2% to total revenue, up from 8.7% last year, a rise of 351 basis points. A significant growth driver has been the quick commerce segment, which continues to create new avenues for consumer engagement. We remain highly optimistic about its potential with its contribution to total revenue reaching 3.1% in quarter 1 FY '26. This performance reflects a broader industry shift towards an omni-channel ecosystem driven by a young digitally savvy customer base. Premiumization remains a key trend as consumers seek higher quality and differentiated designs, while D2C and quick commerce are unlocking new growth opportunities. Increasingly, brands are also being evaluated on purpose and sustainability, making it imperative to align with evolving consumer value
Ajay Patodia
Thank you, Gauravji. Good afternoon, everyone. I appreciate you all joining us for our quarter 1 FY '26 earnings call. Before we open the floor for question-and-answer session, I would like to take a moment to walk you through a brief summary of our financial performance for the quarter. I trust you have had a chance to review the earnings presentation and press release. While Ankitji and Gauravji have already shared their perspective on the broader macroeconomic environment, I will now focus on our financial highlights for the quarter and full fiscal year. In quarter 1 FY '26, our revenue from operations rose by 19.6% year-over-year, reaching INR399.13 crores. Our gross profit for quarter 1 FY '26 grew by 19.0% year-over-year to INR141.48 crores with a gross margin of 35.4%. Our operating EBITDA for quarter 1 FY '26 was INR42.88 crores with a margin of 10.7%. The EBITDA margin stood at 10.9% in Q1 FY '26. Finally, our profit after tax for the quarter was INR21.32 crores, growing by 39
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