Credo Brands Marketing (Mufti) , the company behind the popular men's casual wear brand MUFTI, has reported its financial results for the first quarter, showcasing resilience in a challenging market environment. The company also announced an ambitious growth strategy focused on premiumization and digital expansion.

Q1 Financial Highlights

For the quarter ended June 30, CREDO Brands reported:

Strategic Initiatives for Growth

Mr. Kamal Khushlani, Chairman & MD of CREDO Brands Marketing Limited, outlined the company's growth strategy:

1. Premiumization: The company plans to open 20 new premium flagship stores, focusing on high-potential markets, premium malls, and high-street locations. This initiative aims to elevate brand perception and reignite consumer excitement for the MUFTI brand.

2. Digital Expansion: CREDO Brands is intensifying its digital marketing efforts through partnerships with Google and Meta. This strategy has already shown results, with sales from the company's website more than doubling year-on-year.

3. Omnichannel Approach: The company is leveraging its digital presence to support an omnichannel retail strategy, connecting with consumers across various touchpoints.

4. Increased Marketing Investment: Advertising and marketing spend as a percentage of revenue is expected to increase to 6-7% and 8-10% in subsequent years to support these initiatives.

Market Challenges and Outlook

Mr. Khushlani noted that the quarter's performance reflected continued softness in discretionary spending, particularly across Tier 2 and Tier 3 markets. However, he expressed confidence in the company's strategic direction, stating, "These investments made by us to position and strengthen the MUFTI brand within the premium fashion segment are deliberate investments to realize the full potential of the brand."

The company anticipates that the benefits of these efforts will begin materializing in future years, with advertising and marketing spends expected to stabilize by then.

Operational Highlights

• As of the quarter-end, CREDO Brands operated 444 exclusive brand outlets (EBOs) across 247 towns and cities in India
• Sales mix for the quarter:
  • EBOs: 63%
  • MBO: 17%
  • Online: 11%
  • LFS: 4%
  • Others: 5%
• Product mix for the quarter:
  • Bottomwear: 43%
  • Shirts: 41%
  • T-shirts: 12%
  • Others: 4%

CREDO Brands Marketing Limited remains committed to its vision of becoming one of India's leading premium apparel brands, balancing short-term market challenges with long-term strategic investments in brand building and customer experience.

Credo Brands Marketing (Mufti) , the company behind the popular men's casual wear brand MUFTI, has announced its financial results for the first quarter. The company reported a net profit of ₹63.00 million, showing a significant decline from ₹98.00 million in the same period last year.

Financial Highlights

• Revenue from operations remained relatively stable at ₹1.20 billion, compared to the same period last year.
• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) decreased to ₹310.00 million from ₹334.00 million in the comparable quarter.
• The EBITDA margin declined to 25.85% from 26.96% year-over-year.
• Despite the challenges, the company maintained a strong balance sheet with a paid-up equity share capital of ₹130.74 crore.

Operational Performance

Credo Brands Marketing continued to expand its retail footprint, with a total of 444 Exclusive Brand Outlets (EBOs) across 247 towns and cities in India. The company added 3 new EBOs during the quarter, demonstrating its commitment to strategic expansion.

Sales Mix and Product Portfolio

The company's sales mix for the quarter was diversified across various channels:

The product mix for the quarter was:

Strategic Initiatives

Chairman and Managing Director, Mr. Kamal Khushlani, highlighted the company's focus on premiumization and digital transformation:

"We are entering a phase of transformation, anchored by our vision to position the MUFTI brand firmly within the premium segment of the Indian apparel market. We are accelerating the transformation of our retail footprint by opening 20 odd premium flagship stores, enhancing our presence in premium malls and high-street locations."

The company is also intensifying its digital marketing efforts, with sales from its own website growing by over 100% compared to the previous year.

Dividend Announcement

The Board of Directors has proposed a dividend of ₹3.00 per share, subject to approval at the forthcoming Annual General Meeting scheduled for September 22. The record date for the proposed dividend has been set as September 10.

Future Outlook

Despite challenging market conditions, particularly in Tier 2 and Tier 3 cities, Credo Brands Marketing remains committed to its strategic direction. The company plans to increase its advertising and marketing spend to 6-7% of revenues and 8-10% in subsequent years, anticipating benefits to materialize in future years.

As Credo Brands Marketing continues to navigate the evolving retail landscape, its focus on premiumization, digital growth, and strategic expansion aims to address the current profitability challenges and position the company for future growth in the competitive men's casual wear market.