Vaibhav Global Limited — Q3 FY26 earnings call

Call held 28 Jan 2026

Management summary

Vaibhav Global delivered a strong Q3 FY26, with consolidated revenue crossing INR1,000 crores for the first time, reaching INR1,066 crores, a 9.1% YoY growth. The company achieved significant margin expansion, with gross margin at 63% and EBITDA margin at 13.2%. Digital and in-house brands continued their strong performance, and the Germany business turned profitable. Management provided optimistic guidance for FY27, expecting continued profitable growth despite ongoing macroeconomic uncertainties.

Highlights

  • Consolidated quarterly revenue reached INR1,066 crores, up 9.1% YoY.

  • Gross margin stood at 63%, an increase of 170 basis points YoY.

  • EBITDA margin expanded by 170 basis points to 13.2%, with absolute EBITDA growing 26% YoY.

  • Profit after tax (PAT) grew by 41% YoY to INR90 crores.

  • Digital contribution was 42% of B2C revenue, and in-house brands reached 48% of B2C sales.

  • Germany business turned profitable during the quarter with an EBITDA margin of around 6%.

  • ROCE improved to 21%, while ROE stood at 15%.

  • Interim dividend of INR1.5 per equity share approved.

Key financials

  1. Revenue ₹1,066 Cr +9.1%YoY
  2. Gross Margin 63%
  3. EBITDA Margin 13.2%
  4. PAT ₹90 Cr +41%YoY
  5. ROCE 21%
  6. ROE 15%

What they filed

Q1 FY27: revenue up 12.7%, net profit up 47.4% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue796 977 850 814 877 +10%1,066 +9%935 +10%917 +13%
EBITDA60 110 62 62 78 +30%136 +24%83 +34%97 +56%
Net profit28 64 34 38 48 +71%90 +41%91 +168%56 +47%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • US
    3% Revenue Growth489 bps Product Cost Increase30 bps Gross Margin Increase
  • UK
    -1.8% Revenue Growth12% Ideal World Growth-6% TJC Growth240 bps EBITDA Margin Improvement40% Profit Growth
  • Germany
    5.1% Revenue Growth6% EBITDA Margin (Q3)3,00,000 EURO EBITDA Loss (9M)

Guidance & targets

Digital Contribution

  • Digital contribution to B2C revenue Digital Contribution · end of FY '27 · High confidence 50%
    Digital contribution was 42% of B2C revenue, and we remain on track to reach 50% digital contribution by end of FY '27.

    — Sunil Agrawal, Managing Director

In-house Brands

  • In-house brands sales contribution to B2C sales In-house Brands · before end of FY '27 · High confidence 50%
    our in-house brands reached 48% of sales contribution mark during the quarter, and we are on our journey to achieve 50% sales milestone before the target of end of FY '27.

    — Sunil Agrawal, Managing Director

Profitability - Germany

  • Germany EBITDA Profitability - Germany · full financial year 2025-26 · High confidence Breakeven
    We remain on track to achieve EBITDA breakeven for the full financial year 2025-26.

    — Sunil Agrawal, Managing Director

  • Germany contribution to group EBITDA margin Profitability - Germany · financial year 2026-27 onwards · Medium confidence Start contributing
    We expect Germany to start contributing to group EBITDA margin from financial year 2026-27 onwards.

    — Sunil Agrawal, Managing Director

  • Germany EBITDA Margin Profitability - Germany · next year (FY27) · Medium confidence Noticeably better than almost less than 1%

    Previously less than 1% (FY26) → Noticeably better than almost less than 1%

    We are not guiding specific numbers for next year yet, but we will be noticeably better than almost less than 1% EBITDA this year.

    — Sunil Agrawal, Managing Director

Social Responsibility

  • Meals served per school day Social Responsibility · by FY '40 · High confidence 1 million
    We remain committed to our long-term goal of serving 1 million meals per school day by FY '40.

    — Sunil Agrawal, Managing Director

Revenue Growth

  • Overall Revenue Growth Revenue Growth · FY 2026-27 · High confidence 9% to 11%
    We expect to achieve 9% to 11% revenue growth in FY 2026-27 with EBITDA margin of 10.5% to 11%.

    — Sunil Agrawal, Managing Director

Profitability

  • Overall EBITDA Margin Profitability · FY 2026-27 · High confidence 10.5% to 11%
    We expect to achieve 9% to 11% revenue growth in FY 2026-27 with EBITDA margin of 10.5% to 11%.

    — Sunil Agrawal, Managing Director

Lifestyle Products

  • Lifestyle products contribution to total sales Lifestyle Products · medium-term · Medium confidence 50%
    Lifestyle products contributed 35% of total sales with a medium-term target of 50%.

    — Nitin Panwad, Group CFO

Revenue Growth - Germany

  • Germany Revenue Growth Revenue Growth - Germany · Medium confidence 10% or higher
    our aim would be to get to a revenue growth of 10% or higher in Germany with EBITDA contribution to the group.

    — Sunil Agrawal, Managing Director

Brand Growth

  • Mindful Souls revenue growth Brand Growth · Q1 onwards, then a few quarters down the road · Medium confidence Single-digit growth from Q1 onwards, then double-digit growth
    from Q1 onwards, we expect it to have a single-digit growth and then get into double-digit growth a few quarters down the road.

    — Sunil Agrawal, Managing Director

Risks & concerns

  • Highly elevated precious metal prices and lower consumer confidence

    medium

    Macroeconomic conditions impacting discretionary spending and metal-heavy jewelry sales, leading consumers to defer purchases in US and UK.

    Management acknowledged

  • Revenue stagnation for acquired brand Mindful Souls due to digital customer acquisition costs

    medium

    Digital customer acquisition costs limit scaling beyond a certain percentage of revenue to maintain profitability for the Mindful Souls brand.

    Analyst acknowledged

  • Difficulty in retargeting OTT customers

    low

    The OTT ecosystem is not as evolved as mobile apps, making it challenging to retarget customers once they download through paid media.

    Management acknowledged

Areas of evasion (3)

  • Detailed breakdown of jewelry sales (gold/silver/artificial)
  • Exact OTT channel revenue for Q3
  • Precise timeline for ROE improvement to 20%+

Q&A highlights

2 direct
Sustainability of ASP increases and unit volume decline Direct
unit decline is mainly related to the customer adoption of the products. Right now, the lab-grown adoption is pretty high from the customer point of view. And we are seeing the productivity metrics on TV and also on website, the lab-grown product demand is high. So that is driving the higher ASP, but it is also realizing higher revenue to us.

Addresses concerns about volume vs. value growth, highlighting the strategic shift towards higher-value lab-grown diamonds as a driver for ASP and revenue despite unit volume decline.

Asked by Deepali Kumari

Discrepancy in US revenue reporting between exchange filings and investor presentation Partial
exchange gain specifically is not present in the segment one, it is clubbed between all the entities... Published accounts is based on the geography-wise. And here, we have separated the retail and the manufacturing. U.S., we have 2 entities. One is a sourcing entity. So, that revenue clubbed in U.S. But now for the better presentation, that's the actual real reflected number in investor presentation.

Reveals a difference in how revenue is categorized and reported, which could impact how investors interpret segment performance and comparability with previous filings. Management clarified the difference but didn't fully reconcile the numbers for the analyst.

Asked by Naveen Baid

Impact of India-EU FTA on Germany business and strategy for margin tailwind Direct
our aim would be to get to a revenue growth of 10% or higher in Germany with EBITDA contribution to the group. So, within that objective, we will look at what works best. So, we reinvest some of that into the customer acquisition or to let it flow. So, that will be decided on a pretty dynamic way.

Shows management's strategic flexibility in utilizing potential margin benefits from trade deals, balancing reinvestment for growth (customer acquisition) with direct bottom-line impact, indicating a dynamic approach rather than a fixed strategy.

Asked by Tripti

2 min read 6 chapters

Detailed narrative

Strong Q3 FY26 Performance Driven by Digital and In-house Brands

Vaibhav Global reported a robust Q3 FY26, with consolidated quarterly revenue reaching INR1,066 crores, marking a 9.1% year-over-year growth and crossing the INR1,000 crore mark for the first time. Gross margin expanded to 63%, an increase of 170 basis points YoY, supported by a vertically integrated global supply chain. Digital channels contributed 42% to B2C revenue, while in-house brands achieved 48% of sales contribution, both progressing towards their FY27 targets of 50%.

Profitability Expansion and Operational Efficiency

The company's EBITDA margin expanded significantly by 170 basis points to 13.2%, with absolute EBITDA growing 26% year-over-year. Profit after tax (PAT) saw a substantial increase of 41% year-over-year, reaching INR90 crores. Operational efficiencies, including a 1.2% improvement in HR costs due to automation and AI, contributed to this margin expansion. ROCE improved to 21% and ROE stood at 15%, reflecting enhanced return ratios.

Mixed Regional Performance with Germany Turning Profitable

The US market registered a 3% year-over-year revenue growth despite elevated precious metal prices and cautious consumer sentiment, while the UK saw a 1.8% revenue decline, primarily due to TJC's negative 6% growth. However, Ideal World in the UK grew by 12% YoY, and the overall UK operation delivered a strong 40% profit growth. Notably, Germany turned profitable during the quarter with an EBITDA margin of approximately 6%, and the company expects it to achieve full-year EBITDA breakeven for FY26 and contribute to group EBITDA from FY27.

Strategic Focus on Lab-Grown Diamonds and Higher-Value Customers

The company's strategy to focus on higher-value products, particularly lab-grown diamonds (LGD), is driving ASP increases. LGD now contributes roughly 10.7% of retail revenue with an average selling price of $250, compared to a general digital ASP of around $40. Management emphasized targeting customers with higher lifetime value, shifting away from lower-price point acquisitions, especially in the US digital segment, to improve profitability over volume.

Investments in Digital Channels and AI for Future Growth

Vaibhav Global continues to invest in digital channels, including OTT platforms, where viewership is almost 4x that of linear TV in the US, and customer lifetime value is higher. The company is actively implementing AI across various business processes, such as chatbots, email responses, TV scheduling, and internal data analysis, which has already led to efficiency improvements in HR costs. These initiatives are aimed at enhancing operational efficiency and driving future growth.

FY27 Guidance and Capital Allocation

For FY27, Vaibhav Global has guided for a revenue growth of 9% to 11% and an EBITDA margin of 10.5% to 11%. The Board approved an interim dividend of INR1.5 per equity share, reflecting a 28% payout and a balanced approach to capital allocation. Management expressed confidence in sustaining profitable growth, with ROE and ROC expected to improve in the next year and medium term, despite ongoing adverse macroeconomic conditions.

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