Aditya Birla Lifestyle Brands Ltd (ABLBL) Q2FY27 Concall Transcript - Sep-2026 Qtr
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Moderator: Ladies and gentlemen, good day and welcome to the second quarter earnings conference call of Aditya Birla Lifestyle Brands Limited. The call will begin with a brief discussion by company's management on the Q2 FY27 performance, followed by a question and answer session. We have with us today, Mr. Ashish Dikshit, Managing Director, ABLBL; Mr. Vishak Kumar, Deputy Managing Director and CEO, Aditya Birla Lifestyle Brands Limited; Mr. Dharmendra Lodha, CFO, ABLBL. I want to thank the management team on behalf of all the participants for taking valuable time to be with us. I must remind you that today's discussion may include certain forward-looking statements and must be viewed, therefore, in conjunction with the risks that the company faces, that the companies faces. Please restrict your questions to the quarter performance and to strategic questions only. Housekeeping questions can be dealt separately with the IR team. With this, I hand the conference over to Mr. Dharmendra Lodha. Thank you and over to you, sir.
Dharmendra Lodha (Aditya Birla Lifestyle Brands Ltd): Good afternoon, everyone. Thank you for joining us today. I would like to welcome you all to the quarter two FY27 earnings call for Aditya Birla Lifestyle Brands Limited. The domestic consumption environment remained broadly stable during the quarter with demand trends largely in line with recent periods. While shift in the festive calendar influenced year-on-year comparisons, the broader consumption landscape remained steady amid ongoing global macroeconomic uncertainties. Against this backdrop, our business sustained healthy momentum across key performance metrics, delivering strong revenue growth, healthy like-to-like growth, and improved margin. Importantly, this
Dharmendra Lodha (Aditya Birla Lifestyle Brands Ltd): our fourth consecutive quarter of double-digit revenue growth and fifth consecutive quarter of margin expansion. This performance reinforces the strength of our brands and the clarity of our strategic direction. Now, moving to the quarter two performance of our of business. ABLBL revenue grew 11% year-on-year to Rs. 2,266 crore. Within segments, lifestyle brands grew at 9% YoY with revenue at Rs. 1,906 crore, whereas emerging brands grew 27% versus last year to Rs. 371 crore. All channels maintained strong performance during the quarter. Retail delivered eighth consecutive quarter of healthy like-to-like growth as the overall revenue grew 8% YoY with like-to-like growth at 5.3% on a network of 3,000-plus stores. Small Town network continued to outperform at six-percentage sixth consecutive quarter of double-digit like-to-like growth across 500-plus stores. Wholesale and e-commerce maintained strong growth trajectory, up 18% and 12% YoY, respectively. EBITDA was up at 15% YoY to Rs. 390 crore, with margin expanding 50 bps to 17.2%, driven by operating leverage. PAT more than doubled to Rs. 53 crore, growing 126% YoY. We also significantly stepped up our retail expansion during the quarter, adding over 100 stores, our highest quarterly addition in more than two years. We aim to sustain this pace in the coming quarters, strengthening our presence across key markets. With these additions, our retail network now spans 3,434 stores across more than 800 cities and towns, covering nearly 5.1 million sq ft of retail space. Net debt stand down, sorry, the net debt come down to Rs. 956 crore, compared to same period last year, with company remaining on track to achieve its previously guided debt numbers. Moving to the first half of the year, ABLBL delivered a strong performance with revenue growing 11% YoY to Rs. 4,311 crore. EBITDA increased 15% to 717 crore, with margin expanding 50 bps to 16.6%. PAT grew 70% 73% YoY to Rs. 82 crore, reflecting continued improvement in profitability. Turning to our Lifestyle Brands, the business delivered another strong quarter, growing 9% YoY to Rs. 1,906 crore with EBITDA increasing 10% to Rs. 371 crore, margin at 19.5. Growth was supported by retail like-to-like growth of 5%, along with sustained momentum across wholesale and e-commerce channels. Our brands remain at the heart of our growth straight strategy, with continued emphasis on sharper assortments, attracting young consumers, and strengthening engagement through impactful digital and offline marketing initiatives. In parallel, we are elevating the shopping experience through larger upgraded stores and enhanced retail environment. We are also accelerating the growth of our own e-commerce business, supported by online exclusive merchandise, improved app experiences, and expanding hyperlocal delivery capabilities. These initiatives will remain key priorities as we continue to scale our digital business. Turning to our emerging business portfolio, comprising Reebok, Van Heusen Innerwear, and American Eagle, the business delivered another strong quarter, with broad-based growth across brands and channels translating into meaningful profitability improvement. Revenue grew 27% YoY, supported by healthy 11% like-to-like growth, alongside strong contributions from wholesale and e-commerce. We also continued to expand our distribution footprint across channels, strengthening our market reach. Improved scale and operating efficiencies drove a 530 bps YoY expansion in EBITDA margin to 6.8%.
Dharmendra Lodha (Aditya Birla Lifestyle Brands Ltd): reflecting the portfolio's improving profitability profile. Reebok achieved a significant milestone with the opening of its 250th store in India. We remain committed to accelerating its retail expansion with the ambition of establishing Reebok as one of the fastest growing sportswear brands in the country. As we look ahead, we enter the second half of the year with strong momentum and a clear sense of direction. The festive season has started on an encouraging note with early demand trends giving us confidence in an even stronger H2. With our brands gaining traction, an accelerated pace of stock store expansion, and continued progress on across channels, we believe we are well positioned to capitalize on the opportunity the way it is. We are now open to questions. Thank you.
Moderator: Thank you very much. Thank you, Mr. Lodha. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Shravan Vora from Morgan Stanley. Please go ahead.
Shravan Vora (Morgan Stanley): Hi. Good evening. Thank you so much for the opportunity. So, firstly I want to understand, so now it's four consistent quarters of double-digit growth. And now going ahead the base gets tougher. So, would you expect this momentum to continue going into 3Q given a favorable festive base?
Vishak Kumar (Aditya Birla Lifestyle Brands Ltd): Hi Shravan. Thanks for your question. Simple answer, I think yes, the growth momentum should continue, I mean, quarter on quarter, whatever ups and downs will be there. On a steady state basis, I can safely say that there are enough plans in place for continued growth momentum. That, one part, there is a like-to-like which is, you know, in fact continued quite strongly for a long period of time. That momentum should continue. And there are multiple initiatives to drive that like-to-like growth. Expansion, I think, like Dharmendra mentioned, the momentum has has quite decisively picked up quite nicely now. So, while Q2 was good on expansion, I think Q3 and beyond should be even better on expansion. So, that should also start giving us further growth gains with that. So, net net, yeah, I mean while short term I don't know what pluses and minuses will be there, but in steady state, yes, double digit is something you should expect from this business.
Shravan Vora (Morgan Stanley): Got it. So, just tied to that, when we had done our demerger last year, we had clearly called out that the aspiration for ABLBL as a company is 15% growth, which is double digit growth for the lifestyle brands and higher growth for the emerging brand. So, what what would it take on our part to dial this growth higher to closer to 15% kind of numbers?
Vishak Kumar (Aditya Birla Lifestyle Brands Ltd): Yeah, so and I had said 12, 11% to 12%. I had said basically 11% to 12% and maybe slightly better than EBITDA is what I've said. But yeah, I mean I can I can still say our aspirations are always going to be higher than that. We have to drive for that. There are multiple building blocks in place. We'll have to see which all out of these, shape up stronger. So, for example, Reebok and innerwear have been on very, very steady growth momentum, and the, you know, Dharmendra talked to you about, 250 stores in Reebok already. I have already signed out, and hence we know that by from a projects pipeline point of view, we should cross 300 Reebok stores this year. So, there is a lot of such things which should which augur well for us in terms of overall growth. I'm I'm I'm not going to tell you 15 right now. We'll We'll stay on what we've said, while our our desire is always to do more. We are constantly trying to see what we can build as steady profitable building blocks which will allow us to do that, Shravan.
Shravan Vora (Morgan Stanley): Got it. And just, secondly, could you just call out what is the current inflation we are seeing at the portfolio level and the level of price pricing that we've taken in the current quarter?
Vishak Kumar (Aditya Birla Lifestyle Brands Ltd): Yeah. So,
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