Vedant Fashions Reports 4.6% Growth in Q2 Despite GST Transition Challenges

Vedant Fashions , the company behind popular brands like Manyavar and Mohey, has reported a 4.6% growth in customer sales for Q2, despite facing operational challenges due to GST rate rationalization. The company's performance highlights its resilience in a quarter with no wedding dates, showcasing its ability to navigate through regulatory changes and market dynamics.

Financial Highlights

Metric	Q2	H1
Customer Sales	INR 3,494.00 million (+4.6% YoY)	INR 7,551.00 million (+13.8% YoY)
Revenue from Operations	INR 263.00 crores	INR 544.00 crores (+7.2% YoY)
Profit After Tax	INR 56.00 crores	INR 126.00 crores
Gross Margin	-	66.10%
EBITDA Margin	-	43.00%
Same-Store Growth	-	8.20%

Operational Challenges and Adaptations

The company faced significant operational disruptions following the GST rate rationalization effective September 22. This change necessitated comprehensive system realignments and barcode updates for over 1 million pieces, impacting dispatches for 15-20 days. Despite these challenges, Vedant Fashions managed to maintain its growth trajectory.

Store Expansion and Performance

As of September, Vedant Fashions' store footprint stands at:

1.79 million square feet
671 stores
257 cities globally

The company added a modest 3,500 square feet during the quarter, focusing on strategic and sustainable store openings while rationalizing underperforming locations.

Regional Performance and Strategy

Vedant Modi, Chief Revenue Officer, highlighted improved performance in Andhra Pradesh and Telangana markets, with growth exceeding 20%. The company continues to focus on enhancing customer experience and disciplined store expansion.

Brand Performance

Manyavar: Remains the flagship brand, with ongoing efforts to increase footfall through various marketing initiatives.
Mohey: Shifted strategy from bridal-heavy to include more non-bridal categories, expanding its target audience.
Twamev: Performing well in both Manyavar stores and its EBO format, targeting the bridge-to-luxury market.
Diwas: Showing encouraging results in its second year, focusing on festival wear across India's 50 annual festivals.

Future Outlook

While not providing specific guidance, management expressed optimism about H2, traditionally the larger half of the financial year. The company is focusing on improving retail quality rather than quantity in the near term, with plans for more substantial expansion in the medium to long term.

Vedant Fashions continues to adapt to market conditions, leveraging its strong brand portfolio and strategic initiatives to drive growth in the competitive Indian ethnic wear market.

1 Day	5 Days	1 Month	6 Months	1 Year	5 Years
-0.71%	-2.59%	-12.24%	-16.34%	-55.42%	-34.63%

Vedant Fashions Limited , the company behind popular Indian wedding and celebration wear brands like Manyavar and Mohey, has reported a mixed performance for the first half of fiscal year 2026 (H1 FY26). The company saw overall growth in revenue and retail sales, but faced challenges in the second quarter.

Revenue and Retail Sales Growth

Vedant Fashions reported a 7.2% increase in revenue from operations for H1 FY26 compared to the same period last year. The company's retail sales, which represent sales to end customers, grew more robustly at 13.8% in H1 FY26. However, the growth rate moderated in Q2 FY26, with retail sales increasing by 4.6% compared to Q2 FY25.

Same-Store Sales Performance

The company's same-store sales growth (SSSG) showed divergent trends between the half-year and quarter:

H1 FY26: Positive SSSG of 8.2%
Q2 FY26: Negative SSSG of 2.0%

This indicates a slowdown in performance at existing stores during the second quarter, which may be a point of concern for investors.

Financial Highlights

Vedant Fashions maintained strong profitability metrics:

Metric	Q2 FY26	H1 FY26
Gross Margin	65.20%	66.10%
EBITDA Margin	42.90%	43.00%
PAT Margin	21.30%	23.20%

The company's ability to maintain high gross margins demonstrates its strong pricing power and efficient cost management in the competitive ethnic wear market.

Operational Expansion

As of H1 FY26, Vedant Fashions has expanded its retail footprint to:

1.79 million sq. ft. of retail space
671 Exclusive Brand Outlets (EBOs), including 16 international stores
Presence in 257 cities globally, including 12 international cities

Brand Portfolio and Marketing Initiatives

Vedant Fashions operates multiple brands catering to different segments of the wedding and celebration wear market:

Manyavar: The flagship brand for men's ethnic wear
Mohey: Focused on women's wedding and celebration wear
Twamev: Premium men's wear brand
Mebaz: Regional brand with a strong presence in South India

The company launched new wedding campaigns and collections across its brand portfolio during the period, aiming to capitalize on the festive and wedding seasons.

Outlook

While Vedant Fashions has shown overall growth in H1 FY26, the negative SSSG in Q2 and the moderation in retail sales growth rate suggest potential headwinds. The company's ability to maintain high margins and its continued expansion of retail presence may help in navigating these challenges. Investors will likely keep a close eye on how the company performs in the upcoming festive season, which is typically crucial for the ethnic wear segment.

As the market leader in branded Indian wedding and celebration wear, Vedant Fashions' performance serves as a barometer for the overall health of this segment in the retail sector. The company's future results will be important to watch, especially given the evolving consumer preferences and increasing competition in the ethnic wear market.