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    V2 Retail

    V2RETAIL
    Consumer Services·29 May 2026
    Management Summary

    V2 Retail delivered a strong Q4 and full FY26, with revenue growing 60% and 63% respectively, driven by disciplined execution and strategic investments in value fashion. Profitability saw significant expansion, with PAT growing 125% YoY for the full year. The company continued its aggressive store expansion, adding 136 stores in FY26, and plans further growth while maintaining healthy margins and focusing on customer value.

    Highlights

    5

    • Q4 FY26 Revenue of ₹797 crores, up 60% YoY, significantly outpacing the broader market.

    • Full Year FY26 PAT of ₹162 crores, a stellar 125% YoY growth, reflecting strong operating leverage.

    • EBITDA margins improved to 13.7% in Q4 FY26 (from 11.6% in Q4 FY25) and 14.9% for FY26 (from 13.7% in FY25).

    • Successfully added 136 stores in FY26, expanding the store footprint to 325 stores nationwide, demonstrating effective scaling.

    • ROE improved to 26% in FY26, up from 23.2% in FY25 and 10.7% in FY24, indicating disciplined capital allocation.

    Concerns

    3

    • A one-time write-off of ₹5.77 crores related to physical verification of property, plant, and equipment.

    • Increased inventory levels in March due to geopolitical tensions and early sourcing for upcoming festivals, though stated as temporary.

    • Sales in May 2026 experienced a 'little bit' of impact due to ongoing global conflicts, potentially affecting Q1 FY27 performance.

    Key financials

    Metrics

    12

    Periods

    3

    Headline

    1
    • Total Store Count
      325 stores

    Q4 FY26

    5
    • Revenue
      ₹797 Cr
      YoY+60%
    • EBITDA
      ₹109 Cr
      YoY+89%
    • EBITDA Margin
      13.7%
    • PAT
      ₹17.5 Cr
      YoY+1.7%
    • SSSG
      7.7%

    FY26

    6
    • Revenue
      ₹3,067 Cr
      YoY+63%
    • EBITDA
      ₹455 Cr
      YoY+77%
    • EBITDA Margin
      14.9%
    • PAT
      ₹162 Cr
      YoY+125%
    • SSSG
      8.6%

    Capital allocation

    3
    high confidence
    CategoryHeadline
    Capex

    Capex disclosed

    Internal accruals and cash on balance sheet for this financial year

    Debt

    Debt disclosed

    Liquidity

    Liquidity disclosed

    Company is covered with internal accruals and cash on balance sheet for this financial year.

    Guidance & targets

    11
    CategoryTargetPriority
    Store Count
    New Store Openings
    170-200 stores
    		Medium
    Store Count
    Total Store Count
    2,500 stores
    		Medium
    Same-Store Sales Growth
    SSSG
    8%-10%
    		High
    Gross Margin
    Gross Margin
    28%-30%
    		High
    Revenue
    Revenue Growth
    at least 50%
    		High
    Marketing Spend
    Marketing Spend as % of Revenue
    less than 0.5%
    		High
    Inventory Management
    Inventory Days
    90-100 days
    		High
    Creditor Days
    Creditor Days
    45 days
    		High
    Store Expansion
    New Area Addition
    50% to 60%
    		High
    EBITDA Margin
    Blended EBITDA Margin
    similar
    		High
    PSF
    Company PSF
    similar
    		High

    New Store Openings

    FY27
    Current136 stores added in FY26, total 325 stores
    Target170-200 new stores

    Why it matters

    To verify the company's aggressive expansion plans and their ability to execute on the stated targets.

    I think for this year, the target would be anywhere between 170-200 stores, completely dependent on how we are performing and how the momentum continues.

    How to verify

    key_financials.metrics[label='Total Store Count']

    Risks & concerns

    2
    RiskSeverity

    Geopolitical tensions leading to supply chain disruptions

    Increased safety stock in March resulted in higher inventory levels, but this is expected to normalize once the situation stabilizes. — Management acknowledged

    medium

    Impact of global conflicts on consumer demand

    May sales saw a 'little bit' of impact due to the war, but management expects positive momentum to continue, especially in Tier-2-3 towns, and views it as a short-term hindrance. — Management downplayed

    low

    Q&A highlights

    8

    “I think for this year, the target would be anywhere between 170-200 stores, completely dependent on how we are performing and how the momentum continues. Yes. For at least this financial year, we are covered with internal accruals and the cash on the balance sheet.”

    Clarifies the aggressive store expansion plan for the current year and the funding mechanism, indicating confidence in internal resources.

    asked by Priyanshu Jain

    2 min read5 chapters

    Detailed Narrative

    01

    Strong Q4 and Full Year FY26 Financial Performance

    V2 Retail reported robust financial results for Q4 FY26, with revenue growing 60% year-on-year to ₹797 crores and EBITDA increasing by 89% to ₹109 crores. For the full fiscal year 2026, revenue surged by 63% to ₹3,067 crores, and Profit After Tax (PAT) saw a significant 125% increase to ₹162 crores. EBITDA margins expanded to 14.9% for FY26, up from 13.7% in the previous year, demonstrating improved operational efficiency and pricing power.

    02

    Aggressive Store Expansion and Geographic Penetration

    The company continued its aggressive expansion strategy, adding a net of 136 new stores in FY26, bringing the total store count to 325 stores across approximately 3.5 million square feet of retail space. Management aims to open 170-200 new stores in FY27, focusing on a balanced mix of rural market entry and deeper penetration in Tier-2 and Tier-3 cities. New stores are expected to contribute to EBITDA from the first month, starting at 70-75% of mature store PSF and reaching maturity within 3-4 years.

    03

    Inventory Management and Gross Margin Outlook

    V2 Retail has focused on analytics-driven merchandising and supply chain responsiveness, leading to a gross margin improvement to 30.2% (Pre-IndAS) for FY26. The company plans to maintain gross margins between 28-30% going forward⏳, passing on any 3-4% increase in raw material costs to customers. While safety stock increased in March due to geopolitical tensions, leading to higher inventory levels, the company aims to maintain inventory at 90-100 days and creditors at 45 days.

    04

    Capital Allocation and Funding Strategy

    The company's capital expenditure per new store, including inventory, is estimated at ₹2.6-2.8 crores, with the CAPEX component being ₹1.2-1.3 crores. This expansion is primarily funded through internal accruals and cash on the balance sheet for the current financial year. Management indicated a healthy debt-to-equity ratio and a preference for utilizing debt for future expansion over QIP, if additional capital is needed.

    05

    Long-Term Vision and Operating Leverage

    V2 Retail is building for a 20-year vision to become a top value fashion retailer in India, targeting a total of 2,500 stores. While aggressive new store additions (50-60% new area annually) currently temper company-level operating leverage, older stores show strong EBITDA growth. The company expects to maintain similar blended EBITDA margins and PSF numbers in FY27, with operating leverage expected to become more pronounced once the pace of new store additions relative to the total base slows down, potentially around the 2,000-store mark.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.