Strong delivery, steady margins, macro hedged

Delivered: 3,727 Cr, 18.7% YoY, 10% SSG confirmed by 8% new customers + 3% higher spend per existing customer

Confirmed; price hikes selective, only higher price points, entry-level protected. Apparel high-price segment grew 13.9% SSG vs 10% overall.

Delivered 258.8 Cr PAT, 6.9% margin, 25.6% YoY growth; alignment exact

Stated; management acknowledges range 2-9%, majority at 5%+, best 9-10%. 20% of QC users net incremental (never visited Vishal store).

Validated in pilot; now ready to expand. Only 3 stores opened this quarter; management calls pace 'cautious experimentation phase' over.

Prior call: concern on cost inflation. This call: margin held at 28.7% vs 28.4% prior through cost discipline and selective pricing. OPM 10.4% vs 10.3%.

Prior: experimental phase. This call: validated ROI, per-sq-ft metrics match large format. Now expanding strategically in UP/Haryana. 3,000-store opportunity quantified.

Reaffirmed at 75.2% of revenue. Apparel 100%, GM 75%, FMCG 60% by volume. No shift in strategy, but loyalty customer penetration (+95% revenue) underscores stickiness.

Prior call: early, experimental. This call: 767 stores, 5-10% revenue contribution in majority, 1.4 Cr users, 20% net incremental. Ahead of internal 5% target.

Prior: in pipeline, pre-pilot. This call: first pilot 'very close' to launch, but no date given. Cautious multi-pilot approach confirmed.

Small format half size, half revenue/margin of large format. Only expanding in UP/Haryana where large format saturated. 3,000-store opportunity across country as saturation spreads. Pace to accelerate.

Was experimental phase validating revenue/sq ft and ROCE parity with large format. Phase over. Now at stage to expand rapidly in 2 states. Will open 3,000 small formats across country.

Rolling out to all Delhi NCR stores now. One state at a time (separate supply chain needed). Network completion >1 year. Benefits: inventory count 4-5 hrs vs overnight, shrink reduction, analytics. All validated in pilot.

Lower promotional intensity vs prior year. Focus on price maintenance, not hikes. Impact on SSG positive. Price hikes only in higher price points, selected categories.

Sashi replaces Manoj in same role. No org structure change. Manoj was with company 10+ years, played excellent role.

Multi-brand retail in Airplaza (subsidiary) requires approval. Proactive cap to keep company Indian-owned-and-controlled. Currently 20% foreign holding.

Minimized. No price hikes at entry/mid price points. Only higher price points, selected categories where critical. Price discount vs leader brands maintained or increased.

Price discount must be same or higher than before. Under no circumstances reduce discount vs leader. Private brands as/more attractive as before.

No price hike at opening price points. All hikes at highest price points. Price-sensitive categories (children's clothing, staples) not hiked. No further price increases beyond current. SSG 10% maintained, highest-price apparel grew 13.9%.

8% new customer acquisitions, 3% higher spend per existing customer = 10% SSG. Cannot isolate volume/price across apparel+GM+FMCG.

Transaction value for existing customers up 3% YoY. 7% new customers acquired. Cannot disaggregate volume precisely.

No new competitors. Existing players around for while. No significant acceleration in expansion pace from any player. Vishal been growing double-digit SSG despite competition.

10% SSG testament to loyalty value. Loyalty analytics used daily to sell more to existing customers. Provides extremely valuable insights.

Apparel 100% private brands. Repeat rate >30% on new options. GM 75% private, 50% kitchen appliances branded (Tandem, Bajaj, Prestige). FMCG 60% private by volume. All stable, time-tested brands.

Working on new format. Will pilot first, multiple pilots, then fine-tune and rollout. First pilot launch 'very close.' Cannot give exact date.

Closing inventory Q1: ₹1,900 Cr

Range 2-9%, majority 5%+, best 9-10% of store revenue. Average bill ₹800. Private brand share >75%. 20% of users net incremental.

QC customers buy slightly more but not significantly more than offline. Bill value ~₹800. QC users show higher private brand stickiness.

Significant wage increase across multiple states (Haryana, UP, Telangana, Karnataka, etc). Structural change. Base is up. Will look for optimization opportunities but this is permanent.

Mainly promotion, not significant pricing. If current assumptions and cost structure continue, quite confident. No challenge. Caveats: speculative on West Asia crisis.

Management expects Q1 inflation impact to taper in subsequent quarters, underpinning demand recovery. No quantified FY27 growth assumption provided.

Management confident on margin hold if current assumptions hold. Acknowledged wage inflation is structural. Caveats on macro (West Asia crisis mentioned as speculative risk).

No explicit forward margin target given. Q1 delivery at 6.9% (vs 6.6% prior) shows expansion, but sustainability hinges on cost control amid wage inflation.

Employee cost +13% per sq ft YoY across Haryana, UP, Telangana, Karnataka. Management calls it structural, permanent. Margin offset strategy unquantified.

Gross margin 28.7% gain driven by lower promotion, not pricing power. Continuation hinges on competitive environment not forcing promotional spend.

Q1 elevated inflation weighed on demand environment. SSG 10% holds, but mix shift to lower price points not ruled out. Management expecting taper 'subsequent quarters'.

New format in pipeline, not yet at pilot stage. First pilot launch timeline 'very close' but no date given. Multi-pilot approach implies extended test phase before rollout.

RFID rollout across network will take >1 year. Requires separate supply chain for tagged stores, full stock tagging. Shrink/inventory benefits not realized until rollout complete.

QC contributing 2-9% of store revenue (mostly 5%+), but profitability not quantified. Bill value ₹800 with high delivery density may still be unprofitable at nascent scale.