RELAXONSENovember 19, 2025

Relaxo Footwears Limited

5,908words

124turns

10analyst exchanges

1executives

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Management on call

Prince Jain for their opening remarks. Prince Jain

Thank you, Sameer. Good evening, everyone, and thank you for joining us on our Q2 and H1 FY '26

Key numbers — 40 extracted

INR629 crore

to highlight some key performance metrics for Q2 and H1 FY '26. Revenue from operations stood at INR629 crores in Q2 FY '26 as against INR679 crores in Q2 FY '25. The moderation was primarily due to demand s

INR679 crore

cs for Q2 and H1 FY '26. Revenue from operations stood at INR629 crores in Q2 FY '26 as against INR679 crores in Q2 FY '25. The moderation was primarily due to demand softness in the mass market segment and

INR81 crore

ual revival in demand following the rollout of new GST framework. EBITDA for the quarter stood at INR81 crores. EBITDA margin remained stable at 12.9%, supported by continued operational efficiencies and pru

12.9%

w GST framework. EBITDA for the quarter stood at INR81 crores. EBITDA margin remained stable at 12.9%, supported by continued operational efficiencies and prudent cost management. Profit after tax fo

INR36 crore

ued operational efficiencies and prudent cost management. Profit after tax for Q2 FY '26 stood at INR36 crores as compared to INR37 crores in Q2 FY '25. PAT margins improved by 34 basis points year-on-year t

INR37 crore

and prudent cost management. Profit after tax for Q2 FY '26 stood at INR36 crores as compared to INR37 crores in Q2 FY '25. PAT margins improved by 34 basis points year-on-year to 5.8%, reflecting disciplin

34 basis point

Q2 FY '26 stood at INR36 crores as compared to INR37 crores in Q2 FY '25. PAT margins improved by 34 basis points year-on-year to 5.8%, reflecting disciplined cost control and stable pricing despite muted top l

5.8%

as compared to INR37 crores in Q2 FY '25. PAT margins improved by 34 basis points year-on-year to 5.8%, reflecting disciplined cost control and stable pricing despite muted top line growth. During t

INR2,500

r share to overall sales. The rollout of GST 2.0, which reduced tax rate on footwear priced below INR2,500 to 5% has strengthened our competitiveness versus the unorganized sector and improved affordabilit

verall sales. The rollout of GST 2.0, which reduced tax rate on footwear priced below INR2,500 to 5% has strengthened our competitiveness versus the unorganized sector and improved affordability in

INR1,283 crore

twears Limited November 14, 2025 For the first half of FY '26, revenue from operations stood at INR1,283 crores as compared to INR1,428 crores in H1 FY '25. EBITDA for H1 FY '26 stood at INR181 crores versu

INR1,428 crore

5 For the first half of FY '26, revenue from operations stood at INR1,283 crores as compared to INR1,428 crores in H1 FY '25. EBITDA for H1 FY '26 stood at INR181 crores versus INR187 crores in H1 FY '25. How

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Guidance — 20 items

Prince Jain

opening

“Looking ahead, we remain optimistic about the recovery trajectory and expect momentum to strengthen in the coming quarters, supported by festival demand, GST benefits and our ongoing sales transformation initiatives.”

Gaurav Kumaar Dua

“So I'll answer your first 2 questions and third will be answered by our CFO.”

Gaurav Kumaar Dua

“This will definitely help us to grow as we will be more competitive in the market, and we will be able to face the unorganized competition.”

Prince Jain

“As of now, we don't expect GST 2.0 implementation to have impact on our margins.”

Ramesh Kumar Dua

“And in the third quarter, we are expecting this either will be at the same level or minus 3- 4% that I'm expecting.”

Ramesh Kumar Dua

“Next year is definitely going to be a much better growth.”

Shraddha

“So this would be a similar number, which we can expect for the future, right?”

Prince Jain

“Similar number, yes, we can expect., In future, we are also expecting given the inflation numbers are coming down, government may reduce the interest rates, which can boost our other income in the subsequent quarters.”

Gaurav Kumaar Dua

“Whatever the remaining stock they have, how they will be able to adjust it.”

Gaurav Kumaar Dua

“So I think they will be easily clearing their stock what they have.”

Risks & concerns — 10 flagged

So if you can tell us normalized for these events in your assessment, what would be the actual volume and sales growth or decline this quarter?

— Sameer Gupta

So it's very difficult to right now assume because just October has ended.

— Gaurav Kumaar Dua

So how long will it take to clear the stocks and new MRP hitting the market, it's very difficult to give exact numbers.

— Gaurav Kumaar Dua

I was actually asking the September quarter normalized growth rate in your assessment, the end level, consumer level growth or decline in your assessment.

— Sameer Gupta

As Gaurav mentioned, it is very difficult to estimate because we don't have full visibility on the distributor level of stock and how much they have down stocked.

— Prince Jain

So very difficult to estimate and say without the impact of downstocking, how much would have been the quarter 2 growth.

— Prince Jain

And you still expect a primary decline in third quarter?

— Sameer Gupta

But the decline that we have seen in the past 4, 5 quarters is not because of this rationalization exercise.

— Sameer Gupta

So my concern was from that perspective.

— Devanshu Bansal

Sir just wanted to understand, is the industry also going through this pain of decline in sales?

— Prerna

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Q&A — 10 exchanges

Sir, you stressed on tailwinds from GST reduction. So just a few things I wanted to understand. One is currently, what is the anticipation for growth pickup because this is a very big step and the industry was sort of vouching the government for reduction. So that is one. And secondly, currently, the high-price inventory is in the channel. So what time period do you foresee it will take to sort of flush out the entire high-price inventory, so that we see a round of primary bookings? Thirdly, sir, the industry checks also suggest that for certain categories, the industry has entered into an inv

Gaurav Kumaar Dua

So I'll answer your first 2 questions and third will be answered by our CFO. So your first question was regarding the GST. It is well appreciated by the footwear industry that GST has a reduction of price from 12% to 5%. This will definitely help us to grow as we will be more competitive in the market, and we will be able to face the unorganized competition. Secondly, regarding the stocks, we ourselves carry roughly around 30 to 35 days inventory. And the channel, which is distributors, also carry around 45 days inventory. So the real effect we'll start seeing from December end and January onw

Yes. So I just wanted to understand that the other income for this quarter has gone up considerably. So is there any one-off item in that?

Prince Jain

No, actually, there are no one-off items. Our treasury base versus last year has been higher, and that has led to our other income being higher. And minor impact is because of the hedging gain that we have got because of the dollar rupee depreciation. So this would be a similar number, which we can expect for the future, right? Relaxo Footwears Limited November 14, 2025 Similar number, yes, we can expect., In future, we are also expecting given the inflation numbers are coming down, government may reduce the interest rates, which can boost our other income in the subsequent quarters. Sure. Oka

First question, sir, is that this quarter has multiple moving parts. There is early festive. There has been a rationalization of distributors exercise that we have been doing since past few quarters. General trade would have destocked following announcement of GST rate cuts, probably some restocking towards the last week of September. So if you can tell us normalized for these events in your assessment, what would be the actual volume and sales growth or decline this quarter?

Gaurav Kumaar Dua

So it's very difficult to right now assume because just October has ended. So definitely, in some parts of India, the distributor carrying a lot of stocks with them. So how long will it take to clear the stocks and new MRP hitting the market, it's very difficult to give exact numbers. I was actually asking the September quarter normalized growth rate in your assessment, the end level, consumer level growth or decline in your assessment. So the number that we have reported for quarter 2 is (7.5%). As Gaurav mentioned, it is very difficult to estimate because we don't have full visibility on the

Just wanted to understand your product strategy in terms of open footwear versus closed footwear. In these challenging times, how are you thinking of increasing the share of closed footwear when this open footwear is facing challenges to sell or whatever challenges we are having at the macro level. Could you help us understand whether how this strategy is moving because you are planning to increase the share of closed footwear and that is not happening since a few years now.

Ramesh Kumar Dua

Our focus remains, we have to handle all the categories of footwear, what we are having, not that only one category because all categories are important. If you see the share of our closed footwear is 20%, 80% still is open footwear. So we can't neglect open footwear also. And if you go brand-wise, Sparx is 40% and our Bahamas & Relaxo combined is 25%, Flite is around 38% or something. So all channels require and all categories do require focus, and we can't afford to neglect any. We have to focus on all. I completely agree, sir. But the whole point is that closed footwear share improvement co

Sir, my first question is on the BIS front. Has the implementation been done? And where do we stand? And has the Chinese imports now dramatically reduced since the imposition of BIS?

Ramesh Kumar Dua

No, we have already implemented QCO long back, and we're continuing with that. It is a government's policy and that we have done already. No. But has the Chinese imports reduced because of the BIS implementation? It is very insignificant. The category we are playing in like our Bahamas, Flite brand, it was insignificant. And the category that we are making in our Sparx brand also, that kind of a thing, I don't think we had any impact on it. It was government decision to do that, although we had registered for that also, I was in favor of some import must happen. That keeps the industry on the

Sir, just wanted a more strategic kind of a question. Last 4 years, including this one, we have seen persistent weakness in top line. I understand the GST rates had increased. But if you analyze data over these years, just wanted to net pick which are the areas where there are bigger pain points? Is it metro towns? Is it younger consumers, lower price points, higher price points? Any kind of colour you can give regarding any analysis that you would have done on where the weakness was?

Ramesh Kumar Dua

So it is all categories. Taxation has only played a role. Since January '22, when the government implemented this new taxes of 5% to 12%, that became actually one of the main causes, 90% cause is that only. So now with that reversed, I mean, we should logically go back to the old growth trajectory of 10% plus. I mean, I understand disturbances in between, but as things stabilize, it's logical to assume a 10% plus kind of growth is what we should expect. Yes, it is just a matter of time. The company will be back on track the way it was before January '22. Got it, sir. And you had indicated a ra

Yes. Sir, there is a lot of fake products being manufactured under branded logos in the North market. So while BIS restricts imports, but does that part of industry also get impacted with this GST reduction? I'm talking about all these branded logos, fake copies of branded logos that are being manufactured in huge quantities.

Ramesh Kumar Dua

So it is always happening, and we are always taking actions, it is ongoing. It has been, it will continue, and we'll keep on acting accordingly. But does this GST reduction also increase your competitiveness versus that market or that will still continue to flourish? We are taking our action around that. Anybody who we came to know and using our brand name, copying the things, we will continue. I don't think this menace has increased in the past few quarters or so. It's under control, and we keep on acting the way we get news. That's it. Sir, you have been acting, but there are copies of other

Sir just wanted to understand, is the industry also going through this pain of decline in sales? Or is it with few players like us.

Ramesh Kumar Dua

Organized industry is very limited. The people who are our competitors or local players, we don't have data of it. We can only compare ourselves with ourselves. We know that our sale has gone down and we are working on that because we have noticed that unorganized players are getting some share, but the data is not visible. Okay. Okay. So I mean, we cannot be sure that the industry is also going through the similar thing as of now. The organized players must be suffering, the way we are, even you will see Bata results also got affected this quarter. So all these players are definitely going th

Thank you, everyone. This is all from our side. We thank you all for joining the call. Looking forward to joining you again. Thank you.

Management

This is a transcription and may contain transcription error. The company takes no responsibility of such errors, although an effort has been made to ensure high level of accuracy. Some minor editing may have been done for better readability. In case of discrepancy, the audio recordings uploaded on the stock exchange on November 14, 2025, will prevail.

Contact details

Registered Address: Aggarwal City Square, Plot No.10, Manglam Place, District Centre, Sector-3, Rohini, Delhi-110085 (India) CIN: L74899DL1984PLC019097 Website: https://relaxofootwear.com/

Speaking time

Ramesh Kumar Dua

Gaurav Kumaar Dua

Devanshu Bansal

Prerna

Sameer Gupta

Prince Jain

Moderator

Akhil Parekh

Shraddha

Disclaimer

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Opening remarks

Sameer Gupta

Thanks, Sudha. Good evening, everyone. At IIFL Capital, it is our pleasure to host the management of Relaxo Footwears. From the management, we have Mr. Ramesh Kumar Dua, Chairman and MD; Mr. Gaurav Kumaar Dua, Whole-Time Director; Mr. Prince Jain, CFO; Mr. Ritesh Dua, Executive VP, Finance; and Mr. Ankit Jain, Company Secretary and Compliance Officer. Without taking more time, let me hand it over to Mr. Prince Jain for their opening remarks.

Prince Jain

Thank you, Sameer. Good evening, everyone, and thank you for joining us on our Q2 and H1 FY '26 earnings call. We appreciate your continued interest in our company and are pleased to walk you through our operational and financial performance for the quarter and half year ended 30th September 2025. The earnings release and investor presentations are already available on the stock exchange and on our website for your reference. Before we move into Q&A session, I would like to highlight some key performance metrics for Q2 and H1 FY '26. Revenue from operations stood at INR629 crores in Q2 FY '26 as against INR679 crores in Q2 FY '25. The moderation was primarily due to demand softness in the mass market segment and delayed purchases ahead of implementation of GST 2.0. However, we are now witnessing a gradual revival in demand following the rollout of new GST framework. EBITDA for the quarter stood at INR81 crores. EBITDA margin remained stable at 12.9%, supported by continued operational

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Relaxo Footwears Limited

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