Galaxy Cloud Kitchens Reports Profit Turnaround Amid Business Restructuring

Galaxy Cloud Kitchens Limited , a company specializing in food, beverages, and grocery products, has reported a significant turnaround in its financial performance for the quarter ended June 30, 2025. The company's unaudited financial results, approved by its Board of Directors, reveal a remarkable improvement in both revenue and profitability.

Financial Highlights

Galaxy Cloud Kitchens has shown a substantial increase in its revenue from operations, which rose to Rs 1,060.76 lakhs in Q1 FY2026, compared to Rs 139.13 lakhs in the same quarter of the previous year, marking a 662.4% year-on-year growth.

The company's total income for the quarter stood at Rs 1,060.83 lakhs, up from Rs 139.96 lakhs in Q1 FY2025, representing a 657.9% increase.

Profitability Improvement

In a notable turnaround, Galaxy Cloud Kitchens reported a net profit from continuing operations of Rs 86.52 lakhs for Q1 FY2026, compared to a loss of Rs 61.56 lakhs in the corresponding quarter of the previous year. However, the company's discontinued operations recorded a loss of Rs 42.21 lakhs.

Despite the losses from discontinued operations, the overall net profit for the quarter stood at Rs 44.31 lakhs, a significant improvement from the net loss of Rs 231.35 lakhs reported in Q1 FY2025.

Business Restructuring

The company has undergone significant restructuring, having shut down multiple commissary units between 2022 and 2024. These closures include:

• A unit in Bengaluru, Karnataka (closed October 12, 2022)
• A unit in Mumbai, Maharashtra (closed January 31, 2024)
• A unit in Gurugram, Haryana (closed September 30, 2024)

Galaxy Cloud Kitchens has made necessary accounting provisions for these closed operations in accordance with applicable accounting standards.

Going Concern and Future Outlook

Despite the positive quarterly results, the company's financial position remains challenging. The entire net worth of Galaxy Cloud Kitchens has been eroded due to losses incurred in previous years, with current liabilities exceeding current assets. This situation raises material uncertainty about the company's ability to continue as a going concern.

However, management remains optimistic about the future. The company is committed to improving operational efficiency and has initiated various measures to boost sales, reduce costs, and diversify its business activities. These initiatives include expanding into supermarket store operations, which management believes has the potential to generate positive cash flows.

Other Developments

The Board of Directors has noted that the Nomination and Remuneration Committee has advised management to proceed with formulating an Employee Stock Option Plan (ESOP). Once drafted, the ESOP will be subject to review and approval by the committee, board, and shareholders, in compliance with applicable laws.

Galaxy Cloud Kitchens Limited continues to operate in a single business segment: dealing and trading in food, beverages, and grocery products. The company's management expresses confidence that its ongoing initiatives will lead to a positive net worth in the near future and generate sustainable cash flows to meet all obligations.

As the company navigates through its restructuring phase and works towards financial stability, investors and stakeholders will be keenly watching its performance in the coming quarters.