Brainbees Solutions Limited

Brainbees achieved a significant milestone by reporting a consolidated PBT of ₹6.9 crores in Q3 FY25. This was supported by a robust consolidated cash profit after tax of ₹94.1 crores. The company's focus on unit economics is evident in the consolidated Adjusted EBITDA margin, which reached an all-time high of 6.4%, up from 5.6% in the previous year.

The core India business saw Adjusted EBITDA margins expand to 11.2% in Q3. Despite a 70 bps expansion in 9M, management admitted they are tracking below their 150 bps annual ambition due to seasonal headwinds. Interestingly, the company closed 38 COCO stores for the first time as a 'cleanup' exercise to optimize footfalls and wallet share, while still adding 115 stores on a gross basis during the 9M period.

The International segment faced a challenging Q3 with revenue growth of 13%, impacted by two new horizontal e-commerce entrants in the UAE and KSA. These competitors engaged in 'elevated promotional activities' during Singles Day and Black Friday. FirstCry chose to stay away from these promotions to protect margins, resulting in a slight moderation of growth but an improvement in Adjusted EBITDA from -16% to -15% YoY.

Home brands like Babyhug continue to be a primary driver for gross margin expansion, which improved to 37% in Q3. Management noted that home brand share is growing at a higher CAGR than the overall India multi-channel business. This strategy, combined with better negotiations with third-party brands and a higher share of COCO sales, remains the key lever for reaching long-term profitability goals.

Globalbees reported a 29% growth for the 9M period and a significant jump in Adjusted EBITDA from 0.6% to 1.4% in Q3. The Education business (franchisee preschools) also showed strong momentum with 35% growth in 9M and healthy EBITDA margins of 23%, proving to be a profitable, asset-light addition to the ecosystem.