Landmark Cars Limited, a leading automotive retailer in India, has reported robust financial results for the second quarter, showcasing resilience amid the GST 2.0 transition period. The company's strategic focus on premium automotive brands and expansion efforts have contributed to its strong performance.

Q2 Financial Highlights

Landmark Cars demonstrated significant growth in the quarter ended September 30:

• Proforma Revenue surged by 30.7% year-over-year to ₹16,572.00 million
• Reported Revenue increased by 33.5% to ₹12,109.00 million
• Gross Profit rose by 17.0% to ₹1,958.00 million
• Reported EBITDA grew by 8.0% to ₹592.00 million
• Profit After Tax (PAT) showed a remarkable increase of 353.8% to ₹15.00 million

H1 Performance

The company's half-yearly results also reflected strong growth:

• Proforma Revenue up by 26.4% year-over-year to ₹30,723.00 million
• Reported Revenue increased by 30.7% to ₹22,726.00 million
• Gross Profit grew by 15.9% to ₹3,802.00 million
• Reported EBITDA rose by 19.9% to ₹1,253.00 million
• PAT surged by 134.9% to ₹89.00 million

Strategic Expansion and Brand Portfolio

Landmark Cars has been actively expanding its network across premium automotive brands. The company's portfolio includes Mercedes-Benz, Volkswagen, Honda, MG, and BYD. Notably, three new partner brands - MG, Kia, and M&M - contributed 19% to the total revenue in H1, indicating successful integration and growth of these newer partnerships.

GST 2.0 Transition and Market Adaptation

The introduction of GST 2.0 in September marked a significant shift for the Indian automotive industry. Despite short-term challenges, Landmark Cars has adapted well to the new tax structure. The company offered strategic discounts and incentives to boost sales during the transition period, successfully minimizing overall cess liability.

After-Sales Business Performance

The after-sales business continues to be a strong contributor to Landmark's success:

• After-sales revenue for H1 reached ₹4,888.00 million
• EBITDA for the after-sales segment in H1 was ₹838.00 million
• The company serviced 191,359 vehicles in H1, up from 171,842 in the previous H1

Future Outlook

Landmark Cars remains optimistic about future growth, citing several factors:

1. Robust product pipeline from partner brands
2. Sustained demand driven by GST rate reduction
3. Expansion of the electric vehicle (EV) portfolio
4. Focus on margin recovery and scaling up after-sales services

The company expects these factors to drive continued growth and profitability in the coming quarters.

Management Commentary

Sanjay Thakker, Chairman and Executive Director of Landmark Cars, commented, "Our Q2 and H1 results demonstrate the strength of our business model and our ability to navigate market transitions effectively. The GST 2.0 implementation, while presenting initial challenges, is expected to catalyze broader industry growth. We're particularly encouraged by the performance of our new brand partnerships and the consistent growth in our after-sales business."

Landmark Cars' strong performance amid the GST transition underscores its resilience and strategic positioning in the Indian automotive retail sector. As the company continues to expand its brand portfolio and optimize operations, it appears well-positioned to capitalize on the evolving dynamics of the Indian auto market.

Landmark Cars Limited (ISIN: INE559R01029) has reported a mixed set of financial results for the second quarter of fiscal year 2026, showcasing strong revenue growth but facing pressure on profitability.

Revenue Surge

The company witnessed a significant year-over-year revenue growth of 33.5%, with reported revenue reaching ₹12,109.17 crore in Q2 FY26, up from ₹9,072.69 crore in the same quarter last year. This robust top-line performance indicates strong sales momentum and market demand for Landmark Cars' offerings.

Profitability Challenges

Despite the impressive revenue growth, Landmark Cars faced challenges in maintaining profit margins:

The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) grew by 8% year-over-year to ₹592.00 crore. However, the EBITDA margin contracted to 4.89% from 6.04% in the same quarter last year, indicating increased operational costs.

Profit Before Tax (PBT) showed a modest increase of 26.7% to ₹6.07 crore, while Profit After Tax (PAT) saw a significant jump of 353.8% to ₹15.02 crore, benefiting from a tax credit during the quarter.

Operational Highlights

• The company's inventory management remained disciplined, with inventory days at 38 compared to the industry average of 60 days.
• Landmark Cars opened two new outlets during the quarter, expanding its retail presence.
• The after-sales business continued to show strength, with an 11.1% year-over-year growth in revenue to ₹2,541.00 crore.

Management Commentary

While specific management comments were not provided, the results suggest that Landmark Cars is focusing on expanding its market presence and sales volume, albeit at the cost of near-term profitability. The company's ability to grow its after-sales business is a positive sign, as this segment typically offers higher margins and more stable revenue streams.

Outlook

As Landmark Cars navigates through a challenging automotive retail environment, investors will be watching closely to see if the company can translate its strong revenue growth into improved profitability in the coming quarters. The expansion of outlets and growth in the after-sales segment may provide avenues for margin improvement, but managing operational costs will be crucial for enhancing bottom-line performance.

Investors should note that while the company has shown resilience in growing its top line, the pressure on margins warrants attention. The automotive retail sector's dynamics, including shifts in consumer preferences and regulatory changes, will continue to play a significant role in shaping Landmark Cars' performance in the near to medium term.