Khadim India Limited , one of India's leading footwear retailers, has unveiled its strategic growth plans centered on premiumisation and geographic expansion, alongside its financial results for the first quarter.

Strategic Growth Initiatives

Khadim India is actively pursuing a growth strategy focused on premiumisation and expanding its presence in the southern and western markets of India. The company has forged a strategic partnership with Skechers, enabling the availability of Skechers footwear at select Khadim stores. This move is expected to enhance the company's premium offerings and attract a wider customer base.

Expansion and Market Presence

With a robust network of 884 'Khadim's' branded retail stores, the company has established a pan-India presence across 24 states and 4 union territories. Khadim India operates through an asset-light franchise model, with 76% of its retail presence managed through franchises. This approach allows for rapid expansion while minimizing capital expenditure.

Q1 Financial Highlights

For the quarter ended June 30, Khadim India reported the following financial results:

The company's revenue for the quarter was impacted primarily by a decline in franchise sales. The gross margin was influenced by promotional discounts offered during the period.

Market Positioning and Product Range

Khadim India positions itself as the second-largest footwear retailer in India, with a particularly strong presence in East India and a growing foothold in South India. The company's extensive product range caters to various market segments, from economy to premium, allowing it to address approximately 85% of the total Indian footwear market potential.

Future Outlook

As part of its next growth phase, Khadim India has successfully completed the demerger of its distribution business and manufacturing segment into KSR Footwear Limited. This strategic move is expected to streamline operations and focus on core competencies.

The company continues to expand its retail footprint, with a particular emphasis on markets across South India, West India, and Uttar Pradesh in North India. Khadim India's strategy involves entering new markets through company-owned company-operated (COCO) stores and subsequently augmenting its presence through franchisees.

With its focus on premiumisation, strategic partnerships, and an asset-light expansion model, Khadim India aims to capitalize on the growing footwear market in India while maintaining its position as a leading player in the industry.

Khadim India Limited , India's second-largest footwear retailer, has released its financial results for the first quarter, revealing a challenging period for the company. The footwear giant, known for its extensive presence in East India, faced headwinds in both revenue and profitability.

Revenue and Profit Performance

Khadim India reported a revenue of ₹957.00 million in Q1, marking an 8.1% decrease from ₹1,041.00 million in the corresponding quarter of the previous year. The company's profit after tax (PAT) saw a substantial decline of 81.7%, dropping to ₹8.60 million from ₹47.10 million year-over-year.

Margin Pressure

The company experienced significant margin pressure during the quarter:

The contraction in margins was attributed to promotional discounts offered during the quarter, which impacted the company's profitability.

Retail Network and Strategic Moves

Despite the financial challenges, Khadim India maintains a strong retail presence:

• 884 'Khadim's' branded retail stores across 24 states and 4 union territories
• 207 company-owned and company-operated (COCO) stores
• 677 franchise stores, representing 76% of the retail network

The company has recently completed the demerger of its distribution and manufacturing segments into KSR Footwear Limited, a move aimed at streamlining operations.

Strategic Partnership

In a notable development, Khadim India has entered into a strategic partnership with Skechers. This collaboration will allow select Khadim stores to sell Skechers products, potentially broadening the company's product offerings and customer base.

Market Position and Future Outlook

Khadim India continues to maintain its position as the second-largest footwear retailer in India, with the largest presence in East India. The company is also recognized as one of the top three players in South India and boasts the largest footwear retail franchise network in the country.

While the Q1 results indicate a challenging period, Khadim India's extensive retail network and strategic initiatives, such as the Skechers partnership and the recent demerger, may provide avenues for future growth and recovery. The company's focus on an asset-light model, with 76% of its retail presence through franchises and 90% outsourcing of product requirements, could help in managing costs and improving profitability in the coming quarters.

As the footwear market in India continues to evolve, Khadim India's ability to navigate these challenges while leveraging its strong brand presence and extensive reach will be crucial for its performance.