Aditya Vision

Aditya Vision reported a 6% year-on-year revenue growth to ₹940 crores and a 4% increase in PAT to ₹55 crores for Q1 FY26. This performance was achieved despite an "unusual summer" with continuous rains and no heatwaves in core markets, leading to a 15-30% decline in primary sales for cooling products across the industry. Gross margins improved slightly from 15.22% to 15.33%, and EBITDA margin was maintained at 9.5% through stringent cost control.

To mitigate the impact of softened demand, management proactively rationalized non-critical operating expenses, including advertising, promotional spending, warehousing, freight, and security. This focused approach ensured operational stability and helped maintain profitability, with PAT growing to ₹55 crores from ₹53 crores year-on-year. Management noted that these expenses would likely increase once higher growth rates return, indicating a disciplined approach to cost management.

The company successfully reduced its inventory levels by ₹150 crores in Q1 FY26 compared to March 2025, bringing AC stock to historically normal levels. This was achieved without resorting to discounting, instead leveraging "substantial support" from OEMs like free installations and other facilities. Concurrently, short-term borrowings sharply declined from ₹278 crores in March 2025 to approximately ₹115 crores by June 30, 2025, supported by positive cash flow and a cash and cash equivalent balance of ₹141 crores.

Aditya Vision opened 4 new stores in Q1 FY26 and an additional 3 in July 2025, bringing the total store count to 182. The company remains on track to add 25 to 30 new stores in FY26, aiming to surpass the 200-plus store milestone by year-end. The primary focus for expansion is Tier 2 cities and Western Uttar Pradesh, including Lucknow, where the brand is gaining strong traction and UP's revenue contribution has surpassed Jharkhand.

Despite the negative 4% same-store sales growth in Q1 FY26, management expressed strong optimism for the remaining quarters. Factors cited include a good monsoon leading to a bumper harvest, the Union Budget 2025's personal tax relief (₹1 lakh crore), and Bihar's new 125-unit free electricity scheme, all expected to boost consumer disposable income and discretionary retail demand during the upcoming festive season. The company anticipates full-year SSSG to be in positive territory and aims for 20-25% sales growth.

AC sales contributed approximately 42% of the company's total revenue in Q1 FY26, experiencing a degrowth of only 2% despite the adverse weather. Management reiterated comfort with current AC inventory levels, stating they are not "desperate to liquidate" stock and that ACs are now sold year-round, not just seasonally. The inventory level of ₹548 crores (Q1 FY26) is deemed necessary for the expanded store network and upcoming sales, ensuring product availability.