Dollar Industries Limited , a leading player in the Indian hosiery sector, has reported robust financial results for the second quarter of fiscal year 2026, coupled with a significant strategic announcement.

Financial Highlights

The company delivered a strong quarterly performance, with key financial metrics showing notable improvement:

The company's performance was driven by stable demand across key categories and significant benefits from operating leverage and ongoing cost optimization initiatives.

Strategic Merger Announcement

Dollar Industries has announced a strategic merger of nine promoter group companies into the listed entity. This restructuring aims to:

1. Eliminate structural overlaps
2. Strengthen operational control
3. Significantly reduce related party transactions
4. Bring the Dollar brand fully under Dollar Industries Limited

The merger is expected to yield both monetary and non-monetary benefits, including savings on rent, compliance costs, and employee expenses. While the exact financial impact is yet to be quantified, initial estimates suggest potential savings of Rs. 5-6 crores annually.

Operational Highlights

• Thermals Performance: The thermal category showed exceptional growth with 23.50% value and 28.10% volume increase year-on-year.
• Premium Segment: Force NXT, the company's premium innerwear line, sustained its growth trajectory with 6.00% value and 19.20% volume growth.
• Kids' Range: The Champion brand posted remarkable gains with 109.40% value and 73.90% volume growth.
• New-Age Channels: Modern trade, e-commerce, and quick-commerce together contributed 10.20% of overall revenue, with quick-commerce scaling rapidly to contribute 4.00% of total sales.

Working Capital Management

The company reported improvements in working capital management:

• Receivable days reduced to 116
• Inventory days moderated to 119
• Payable days increased to 68
• Cash conversion cycle improved to 167 days from 173 days in June

Outlook

Dollar Industries maintains its guidance of 11-12% revenue growth for the fiscal year. The company aims to sustain its EBITDA margin in the 12-13% range for FY26, with a long-term target of reaching around 14% EBITDA margin in the coming years.

The management remains focused on strengthening free cash flow, reducing debt, and continuing its premiumization strategy. With the recent strategic moves and strong financial performance, Dollar Industries appears well-positioned to navigate the competitive landscape in the Indian hosiery sector.

Dollar Industries Limited , a leading player in the Indian hosiery space, has announced robust financial results for the second quarter of fiscal year 2026, demonstrating significant growth in profitability and operational efficiency.

Financial Highlights

The company reported a 5.6% year-on-year increase in revenue from operations, reaching ₹47,029.00 lakhs for Q2 FY26. More impressively, Dollar Industries saw a substantial 23.3% year-on-year growth in operating EBITDA, which stood at ₹6,031.00 lakhs for the quarter. The operating EBITDA margin expanded by 183 basis points to 12.8%, reflecting the company's focus on operational leverage and cost optimization.

Profit After Tax (PAT) for Q2 FY26 grew by an impressive 32.7% year-on-year to ₹3,517.00 lakhs, with the PAT margin improving by 151 basis points to 7.4%. This strong bottom-line performance underscores the company's ability to translate top-line growth into enhanced profitability.

Key Performance Drivers

Dollar Industries' robust quarterly performance was driven by several factors:

1. Consistent demand across key product categories
2. Significant benefits from operational leverage
3. Successful cost optimization initiatives
4. Reduction in advertisement expenses as a percentage of operating income

The company has managed to curtail its advertisement expenses to 6.2% of operating income in H1 FY26, compared to 7.2% in H1 FY25, and plans to further reduce this percentage in the coming quarters.

Product Segment Performance

The thermals segment emerged as a standout performer, registering a robust growth of 23.5% year-on-year in value terms. Volumes in this segment increased by 28.1% year-on-year in Q2 FY26, supported by expectations of a prolonged winter season and improved product availability across key geographies.

Distribution Channel Expansion

Dollar Industries continued to strengthen its presence across modern trade, e-commerce, and Quick Commerce channels. These channels collectively contributed 10.2% of total sales during the quarter. Notably, revenue from quick commerce, although on a relatively small base, scaled sharply to contribute 4.0% to overall sales, underscoring its increasing significance in the company's retail mix.

Strategic Merger Announcement

In a significant development, Dollar Industries has announced a proposed merger of nine promoter group companies into the listed entity. This strategic move aims to consolidate brand ownership, manufacturing units, and enhance operational efficiency. Key highlights of the merger include:

1. Consolidation of the 'Dollar' brand ownership directly under Dollar Industries Limited
2. Streamlining of operations and alignment of long-term goals
3. Strengthening of in-house production capacity
4. Reduction in intercompany transactions
5. Avoidance of potential conflicts of interest

The company has applied to BSE and NSE for their prior approval to the scheme before submission to NCLT for its approval.

Management Commentary

Vinod Kumar Gupta, Managing Director of Dollar Industries Limited, commented on the results: "We are pleased to report another quarter of steady performance and strategic progress. The proposed merger marks a key milestone for our company, consolidating our brand ownership and enhancing our operational control and efficiency. Our focus on operational leverage and cost optimization has yielded significant benefits, as reflected in our expanding margins. We remain committed to driving growth through stronger brand ownership, operational excellence, and deeper channel integration, positioning Dollar Industries for sustained value creation and long-term success."

Dollar Industries continues to demonstrate its resilience and adaptability in the dynamic Indian hosiery market. With its strategic initiatives and robust financial performance, the company appears well-positioned for future growth and market leadership.