V2 Retail posted a significant jump in profitability for the first quarter of FY27, with consolidated net profit rising 70% year-on-year to ₹41.9 crore. The growth was underpinned by robust top-line expansion, as revenue climbed 58% to ₹997.2 crore from ₹632.2 crore in the corresponding period last year. The Board of Directors approved these unaudited financial results on August 13, 2026.

Operating performance also strengthened, with EBITDA increasing 60% to ₹139.5 crore from ₹87.2 crore. The company reported a gross profit of ₹285.0 crore, reflecting a gross margin of 28.6%, compared to 29.5% in the prior year period.

Financial Performance

The company’s financial results for the quarter reflect strong volume growth of 56% and robust price realization gains. Consolidated revenue stood at ₹997.2 crore, while consolidated net profit attributable to owners was ₹41.9 crore. Standalone metrics mirrored this trend, with standalone EBITDA rising 55% to ₹1.4 billion (approximately ₹140 crore) and standalone net profit rising 51% to ₹419 million (approximately ₹41.9 crore).

Store Expansion and Operational Metrics

As on June 30, 2026, the company operated 381 stores with a total retail area of approximately 40.7 lakh sq. ft. across 25 states and one Union Territory. During Q1FY27, the company opened 57 stores and closed one, resulting in a net addition of 56 stores. Subsequently, the company crossed the milestone of 400 stores nationwide.

Operational efficiency remained strong, with same-store sales growth (SSSG) standing at approximately 7.5% for the quarter. Full-price sales contributed 90% of total revenue, indicating healthy demand without heavy reliance on discounts. The per square foot (PSF) revenue for Q1FY27 stood at ₹886 per month.

Forward Guidance and Capital Allocation

During the earnings call held on August 14, 2026, Director and CEO Akash Agarwal provided specific guidance for FY27. He stated that revenue growth is expected to be at least 50%, while gross margins should remain between 29% and 30%. The company aims to maintain EBITDA margins despite aggressive store openings.

Regarding capital allocation, Agarwal confirmed that internal accruals will be sufficient to fund the opening of 170 to 200 stores in FY27, negating the need for further equity fundraising such as a QIP. The company plans to utilize approximately ₹150 crore to ₹200 crore released from vendor prepayments, alongside generated EBITDA. Additionally, V2 Retail is in talks with banks to increase credit limits, citing a low debt-to-equity ratio.

Capex per store has increased by 10% to between ₹1.2 crore and ₹1.22 crore, up from ₹1.1 crore previously, due to rising input costs. New stores are breaking even from the first month, with a payback period of 2.5 to 3 years.

Key Corporate Developments

Alongside the financial results, the Board announced key leadership appointments effective August 13, 2026:

• Manu Agarwal appointed as President – Buying & Merchandising and Senior Management Personnel. With approximately 25 years of experience, he previously held senior roles at Aarkey Retail Private Limited.
• Dinesh Malpani appointed as President – Operations and Senior Management Personnel. An ISB alumnus with 30 years of retail experience, he formerly served as CEO at Jubilant Retail and Sabka Bazaar.

Additionally, during June 2026, the company acquired inventory, property, plant, and equipment pertaining to 12 stores from M/s Aarkey Retail Private Limited, along with related lease rights and obligations. The acquisition of RK Retail, completed around the end of June, is expected to impact financials from Q2FY27 onwards.

Management Commentary

Ram Chandra Agarwal, Chairman & Managing Director, stated that the company continues to deliver exceptional growth momentum, achieving revenue growth of 58% alongside maintaining healthy returns. He highlighted that consumption is expanding beyond metros, organized retail is gaining share, and smaller cities are becoming more connected and willing to spend on better products. Agarwal emphasized the company’s disciplined approach to expand the network, protect store economics, and manage working capital prudently.

Akash Agarwal noted that geopolitical tensions have led to increased safety stock in warehouses, resulting in higher inventory levels. The company targets maintaining inventory at around 100 days and creditors at 45 to 50 days once the situation normalizes. To mitigate rising raw material costs, expected to increase garment costs by 4% to 5% from Q3FY27, the company plans to pass on price hikes of 4% to 5% to consumers.

What the Numbers Show

While both revenue and EBITDA expanded at healthy double-digit rates, the EBITDA margin improved slightly from 13.8% in the prior year period to 14.0% currently. This divergence suggests that despite a slight compression in gross margin (from 29.5% to 28.6%), operating leverage or cost controls allowed the company to maintain stable EBITDA margins. The net profit growth outpacing EBITDA growth indicates favorable dynamics in other income or tax provisions relative to the prior year.

Auditor’s Note on Advances

The independent auditors, Singhi & Co., drew attention to an advance amounting to ₹1,206.23 million outstanding since April 2019 with Bennett, Coleman and Co. Limited (BCCL). The underlying advertisement contract has been extended until March 31, 2028. Management considers this balance fully recoverable against future advertisement services within the extended contract period.

V2 Retail has outlined aggressive expansion plans for the current fiscal year, anticipating at least 50% revenue growth. The company aims to maintain gross margins between 29% and 30%, while keeping EBITDA margins stable despite the operational complexities of opening new stores.

The retailer plans to add 170 to 200 new outlets this year. To support this expansion, capital expenditure per store is set to increase by 10%, rising to ₹1.2-1.22 crore per unit. This investment strategy underscores the company’s commitment to scaling its footprint while managing cost structures.

Operational Efficiency and Inventory Management

V2 Retail targets a same-store sales growth (SSSG) of 8% to 10% for the year. Management noted a minor setback in Q1 due to Adhik Maas, a lunar calendar event that can impact consumer spending patterns in certain sectors. Despite this, the company remains focused on maintaining consistent growth across existing locations.

To optimize working capital, V2 Retail plans to maintain inventory levels at around 100 days. Concurrently, the company intends to extend creditor days to 45 to 50 days. This approach suggests a strategic balance between holding sufficient stock to meet demand and leveraging supplier credit to fund operations.

What the Numbers Show

The combination of a 10% increase in per-store capital expenditure and the target of opening up to 200 new stores indicates a significant ramp-up in fixed asset investment. With gross margins targeted at the lower end of the 29%-30% range, the company appears to be prioritizing volume and market share expansion over immediate margin maximization. The stability of EBITDA margins amidst such rapid scale-up suggests that operating leverage from higher sales volumes is expected to offset the incremental costs associated with new store openings and higher capex.

Long-Term Outlook

Looking beyond the current fiscal year, V2 Retail has set a compound annual growth rate (CAGR) target of 50% over the next two to three years. This long-term guidance aligns with the aggressive near-term store addition plan, signaling sustained confidence in the brand’s scalability and market demand.