CAMPUSNSE17 November 2025

Campus Activewear Limited

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Management on call

Nikhil Aggarwal

Whole-Time Director and CEO, for his

Key numbers — 40 extracted

16%

unwavering focus on high growth categories. This quarter, we experienced strong revenue growth of 16% while our profit after tax surged by 40%. This remarkable achievement is primarily driven by the

40%

s. This quarter, we experienced strong revenue growth of 16% while our profit after tax surged by 40%. This remarkable achievement is primarily driven by the robust momentum in our distribution busin

20%

achievement is primarily driven by the robust momentum in our distribution business delivering a 20% growth Y-o-Y. During the quarter, Campus Activewear's Annual Retailer Meet 2025 themed Move Tog

5.7%

n network along with a higher brand visibility. Our online sales saw modest growth of 5.7% influenced by the timing shift of major festive sales post announcement of GST reforms. Moving to

INR 1,500

rformances, I would like to highlight the outstanding performance of our premium segment, that is INR 1,500-plus price point, the saliency of which has improved from 45.2% to 57.2% Y- o-Y leading to an impr

45.2%

our premium segment, that is INR 1,500-plus price point, the saliency of which has improved from 45.2% to 57.2% Y- o-Y leading to an improvement in ASP by INR 50 during Quarter 2 FY '26. We are also

57.2%

ium segment, that is INR 1,500-plus price point, the saliency of which has improved from 45.2% to 57.2% Y- o-Y leading to an improvement in ASP by INR 50 during Quarter 2 FY '26. We are also thrilled

INR 50

the saliency of which has improved from 45.2% to 57.2% Y- o-Y leading to an improvement in ASP by INR 50 during Quarter 2 FY '26. We are also thrilled to announce that actor Kriti Sanon is the new face o

INR 387 crore

st take you through the highlights of the performance. Our operating revenue grew by 16% Y-o-Y to INR 387 crores in Quarter 2 FY '26 largely driven by distribution channel, which has registered a growth of 20%

iven by distribution channel, which has registered a growth of 20%. Online channel has grown by 6%. The company sold roughly 5.75 million pairs of shoes in this quarter versus 5.36 million pairs l

5.75 million

l, which has registered a growth of 20%. Online channel has grown by 6%. The company sold roughly 5.75 million pairs of shoes in this quarter versus 5.36 million pairs last year. The average selling price gre

5.36 million

nnel has grown by 6%. The company sold roughly 5.75 million pairs of shoes in this quarter versus 5.36 million pairs last year. The average selling price grew by 8% Y-o-Y to INR 672 versus INR 622 per pair

Guidance — 20 items

Nikhil Aggarwal

opening

“The recent reductions in GST rates are expected to spur demand and we anticipate sustained momentum in our premium segment bolstered by our distribution strength and capacity expansion plans.”

Nikhil Aggarwal

“So, I mean we do expect GST benefit to create better demand for sure and what we can do from our side is basically focus on execution on the back end and front end.”

Nikhil Aggarwal

“And we do expect that over medium and long term, definitely this is going to expand volume for organized players and so that is part of our strategy in terms of capacity expansion as well and we expect volumes to further grow on this basis.”

Nikhil Aggarwal

“We expect the overall A&P expense for the entire year to still end up at around 8.5%, same as last year.”

Nikhil Aggarwal

“As India is actually one of the lowest cost producers in the world today far beating China by a significant margin in terms of cost so we do believe export is a very lucrative opportunity for the entire country going forward.”

Sanjay Chhabra

“But we foresee that by end of March, we will be able to sort of reduce our both working capital and our borrowings, which are sitting in the balance sheet.”

Nikhil Aggarwal

“So, we hope to continue the same momentum as we have done in Quarter 2 and we're still aspiring for a double-digit growth for the end of the year like for the whole year.”

Nikhil Aggarwal

“So, we are actually there if you normalize it and you take out the phasing impact of marketing, which is just a phasing thing for Quarter 2 as we expect marketing to still close at 8.5%, the same as last year.”

Nikhil Aggarwal

“But this, as we are ramping up the plant quite rapidly, we expect to neutralize this impact as well by the end of the year.”

Resha Mehta

“And the aspiration is to move to 17%, 18% or 16% is the steady-state margin that we can assume we would like to aspire for?”

Risks & concerns — 4 flagged

I wanted to check if there was any growth impact of this change for us also during Q2.

— Devanshu Bansal

So, we are actually there if you normalize it and you take out the phasing impact of marketing, which is just a phasing thing for Quarter 2 as we expect marketing to still close at 8.5%, the same as last year.

— Nikhil Aggarwal

So, if you put that back into EBITDA so we have basically delivered about 16% on a normalized basis and plus we also have a slight one-off in terms of the Haridwar 2 ramp- up where the employee cost has gone up and it has had an impact of 0.4% on the material margin.

— Nikhil Aggarwal

And second, because we have passed the festive month, how has the momentum been especially in the online channel, which is a bit weak in Q2?

— Manasvi Shah

Q&A — 12 exchanges

Congratulations on a good growth pickup. So, Nikhil, so most FMCG peers are reporting some dip in volumes due to channel's focus on clearance of higher price inventory as these prices were sort of scheduled to be cut during the quarter. I wanted to check if there was any growth impact of this change for us also during Q2.

Nikhil Aggarwal

So, we did face 15 days of disruption in September after the GST cut announcement and by the postponement of the festive season sales, the PBT and all. But yes, we were well positioned by then for the quarter and we have been able to still deliver like 7.5% volume growth in spite of that. So, is there anything else you wish to understand in this regard? Yes. So, Nikhil, sir, my question was as in the growth has been very decent in Q2. So, do you see that channel inventory is now at below normal levels and in Q3 we may see even faster growth? So, that was the intent of this question. So, I mean

Congratulations on the strong set of growth. My question is twofold. First on the revenue part. If we look at your online absolute volumes also, the absolute volumes have kind of declined and I'm understanding this is largely because of the shift in the Big Billion Days sale, right? So, probably the spend that we have done ahead of the first sales should benefit in Q3. Is that the right understanding?

Nikhil Aggarwal

That's correct, Gaurav, yes. So, there has been a shift of sales that way, but the marketing has been spent with that regard. So, I was just saying that Q3-Q4 ideally should see better margins given that the advertisement spend have been bit contained. So, yes, advertisement is just a phasing effect like we have seen about 10.5% A&P expense in Quarter 2, which should have been 8.5%, right? So, this is just a phasing thing. We expect the overall A&P expense for the entire year to still end up at around 8.5%, same as last year. And just on the align question here. The D2C offline has kind of see

Congrats on a strong revenue growth print. My first question was again on MBO. So, is there anything different in terms of the product mix? Maybe you can talk about how sneakers grew, which was driving some delta on growth because otherwise this channel was growing at somewhere like 8%, 9%, right, since last 3 quarters. So, has anything different happened, which you can kind of give color on?

Sanjay Chhabra

Okay. Umang, it's more around execution. As Nikhil mentioned earlier, like we are focusing both on the back-end product development and execution in-house and also on the front end on the distribution side. So, there has been increase in the number of retail outlets where we have built consistently more than 12 players. So, I would say that repeat billing has been there and also the premium portfolio what we talked about, including sneakers. So, there we have seen a fair amount of traction and that has resulted in this disproportionate growth. Understood. And any volume growth you can call out

I also wanted to understand the sneaker performance as that has been the focus category to premiumize and the ASP that we've seen at INR 672 is we are in the similar range since last 3 quarters. So, is there a seasonality wherein Q2 is generally lower that we're highlighting that the ASPs have been great?

Nikhil Aggarwal

Prerna, so 2 things have happened here. One is that we have also taken some correction on our open portfolio with respect to very low price points, which were sort of margin dilutive. So, we have corrected that portfolio and taken a bit of a volume correction there. And we have increased our premium portfolio on the sneaker side significantly due to confidential strategic reasons. I would not like to call out exact volume, but I can tell you that it's been growing 100% plus Y-o-Y. So, the performance has been very encouraging on the sneaker side and therefore, the future expansion is also alig

So, we have seen increasing our capacity for the sole and uppers. So, any strategic reason apart from the fact that as we premiumize, the vendors would not really invest so much for premium capacity. So, any other strategic reason which gives us this advantage because of which we are investing in soles and uppers?

Nikhil Aggarwal

Sure. So, there are 2, 3 things that basically help us take this decision of additional CAPEX in our own capacities. One is that it's the IP protection, which is a big lever in our segment so it basically pushes out the competition by a good 6 to 8 months in terms of the launches that we first launch. And secondly, it is about investing in state-of-the-art technologies, which a lot of our vendor base is unable to do. So, the kind of plants that we are now setting up with Haridwar 2 and now Pant Nagar coming up, the technologies here is basically the same as the ones in China or Vietnam that ar

Congratulations on the good set of numbers. Sir, so I actually joined a bit late. So, if you could just give a bit of clarification with terms to the change of inventory valuation. And also if you could just give a basic like the working capital intensity for your H2, any targets which you have in mind?

Sanjay Chhabra

Okay. So, our FG inventory is influenced by seasonality. So, normally during closure of Q2, the inventory goes up depending on the phasing of Diwali and of course Q3 is our biggest quarter. So, the requirement for working capital increases in Q2. Apart from that, in this year there has been a change in MSME laws. So, many of our vendors are falling in the definition of MSME so our payment terms to them have got revised from 90 days to 45 days. These 2 trigger points have led to a higher working capital requirement. But we foresee that by end of March, we will be able to sort of reduce our both

Congrats on good set of numbers. This is more a bookkeeping question. So, what happened to the lease liabilities? The cash flow from lease repayments have jumped sharply from somewhere around INR 20 crores to INR 80 crores.

Sanjay Chhabra

Okay. So, this is Sanjay. So, our lease liabilities have increased primarily because of the Pant Nagar facility that is on a 71-year lease from SIIDCUL Industrial Development Authority. So, you would have seen our announcement when we did this acquisition. So, this acquisition is both land and building. Building has got capitalized in the fixed asset bucket or currently it is sitting in CWIP. But the land part, which is on a lease, is sitting in ROU and also in the lease liability. Okay. How should we see the depreciation and interest cost going ahead because of this thing on an annualized bas

Sorry, my questions have been answered.

Management

So, on the exports, sir, what is the vision in terms of revenue, some numbers here and also would this be a much higher margin business?

Nikhil Aggarwal

So, I think it is too little early on this call to call out the next 2-, 3-year vision map. But maybe I think by the end of this year, we can call it out by, let's say, April. And margin, certainly it could be higher margin business given that we have lower cost than the other countries like China. But like I said, it is still in WIP. It is a very small business at this point and let us come back to you on a bigger plan in 2 quarters from now once we have a fair bit of visibility. Right and on the margin front, right, so I think we are at around 13.5% kind of EBITDA margin for H1 while our asp

Just on the CAPEX, I want to understand that we have outlined a good CAPEX amount of around INR 280-odd crores. So, of that, how much this will lead to the capacity of the borrowed basis and till what kind of stage this capacity will suffice for?

Sanjay Chhabra

So, Gaurav, this outlook on CAPEX is for 3 financial years. So, in the year 1, which is current financial year, we are just focusing towards setting up an upper line here which would augment the capacity by roughly 3 lakh pairs per month, which 36 lakh pairs per year. Then in phase 2, it will be a repeat of this. And then in phase 3, we will augment our assembly capacity. So, there's a 3-year road map and the CAPEX will be distributed over these 3 years. Of course year 1 has a higher skew because of the land and building CAPEX. Sure. And the quantum is right, INR 279 crores or INR 280 crores,

Just wanted to understand your EBO expansion strategy. You are at 290-odd stores today. Please help us understand what would be your EBO expansion strategy for '26, '27, '28?

Nikhil Aggarwal

Sure. So, we slowed down slightly in this year for EBOs primarily to focus on profitability and to also optimize the store levels and with these new launches of new categories like apparel, right? So, we'll bring the focus back next year. This year we have taken a bit of a pause to basically focus on profitability. Next 2-3 years, we do expect to get back to the earlier momentum of at least 70 to 75 stores per year ramping up to, let's say, close to 500 stores in the next 3 years, right? So, that would give us a very good sort of base for even like additional growth and premiumization. And jus

Congratulations on a very good set of numbers. And apologies, I joined in the call a bit late. Just 2 questions from my side. One is, sir, a lot of other consumer companies have called out destocking led impact because of the entire GST transition. This quarter you have had a good growth in distribution channel. But is there any sort of stocking impact especially because when I look at your working capital, that has elevated? So, that was the first question. And second, because we have passed the festive month, how has the momentum been especially in the online channel, which is a bit weak in

Sanjay Chhabra

Yes, you joined a bit late. One question we have already answered. But on the distribution channel front, like we see that we are focusing more on secondary replenishment model and our inventories in the channel continues to be in the healthy range of 100-odd days. So, 3 months is something we presume that it takes from our factory to the distributor to the retailer. So, that's the kind of cycle time it is. So, we maintain an inventory of around 3 months with the channel and that's where it stands. So, there's not much of upstocking, which is getting reflected at their end. Of course we had a

Speaking time

Sanjay Chhabra

Nikhil Aggarwal

Moderator

Gaurav Jogani

Resha Mehta

Devanshu Bansal

Prerna Jhunjhunwala

Umang Mehta

Shraddha Kapadia

Avinash Karumanchi

Opening remarks

Nikhil Aggarwal

Thank you. Good evening, everyone. Thank you all for joining us today for our Quarter 2 and H1 FY '26 Earnings Call. I am excited to share with you the performance of our company in the 2nd Quarter and the first half of FY '26. Our results reflect the strength of our distribution-led strategy and our unwavering focus on high growth categories. This quarter, we experienced strong revenue growth of 16% while our profit after tax surged by 40%. This remarkable achievement is primarily driven by the robust momentum in our distribution business delivering a 20% growth Y-o-Y. During the quarter, Campus Activewear's Annual Retailer Meet 2025 themed Move Together, Grow Together reflected our brand philosophy of Move Your Way and emphasized our commitment to co-creating progress with our extensive retail network. The event was not just about showcasing our product portfolio; it was a celebration of our shared momentum and the evolving insights into consumer needs. From trendy sneakers to women'

Sanjay Chhabra

Thank you, Nikhil. Good evening, everyone, and thank you for joining us in Q2 and H1 FY '26 Earnings Call for Campus. I would first take you through the highlights of the performance. Our operating revenue grew by 16% Y-o-Y to INR 387 crores in Quarter 2 FY '26 largely driven by distribution channel, which has registered a growth of 20%. Online channel has grown by 6%. The company sold roughly 5.75 million pairs of shoes in this quarter versus 5.36 million pairs last year. The average selling price grew by 8% Y-o-Y to INR 672 versus INR 622 per pair last year. During the quarter, business model with our online channel partners got realigned. Our channel partners are now directly charging goods transportation charges from their customers and accordingly, our revenue and freight and commission expenses are lower by INR 8 crores. The overall revenue growth versus last year is adversely impacted by approximately 2% due to this change in business model. Women's share in revenue mix has impr

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Campus Activewear Limited

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