Relaxo Footwears (RELAXO) Q2 25/26 earnings summary

Executive summary

• Q2 FY26 revenue declined to ₹629 crore from ₹679 crore in Q2 FY25, mainly due to demand softness and GST 2.2 transition; H1 FY26 revenue was ₹1,283 crore, down from ₹1,428 crore in H1 FY25.

• Q2 FY26 EBITDA margin was 12.9%, stable year-over-year, while PAT margin improved to 5.8% from 5.4% in Q2 FY25.

• H1 FY26 PAT was ₹85 crore, up 4.9% year-over-year; basic and diluted EPS for H1 FY26 stood at ₹3.42, compared to ₹3.26 in H1 FY25.

• No. of pairs sold in Q2 FY26 was 4.1 crore, down from 4.3 crore in Q2 FY25; average realization per pair remained steady at ₹151.

• Unaudited financial results for the quarter and half year ended September 30, 2025, were approved and reviewed by the Board and auditors, with no material misstatements noted.

Financial highlights

• Q2 FY26 EBITDA was ₹81 crore, with a margin of 12.9%; H1 FY26 EBITDA was ₹161 crore, down 13.4% year-over-year.

• Q2 FY26 PAT was ₹36 crore, nearly flat year-over-year; H1 FY26 PAT was ₹85 crore, up 4.9%.

• Q2 FY26 profit before tax was ₹48.85 crore, compared to ₹49.57 crore in Q2 FY25; H1 FY26 profit before tax was ₹114.76 crore, up from ₹109.90 crore.

• Q2 volume/sales decline was -7.5%; normalized, the decline could have been 200-300 bps better without distributor destocking.

• Annual FY25 revenue was ₹2,790 crore, with EBITDA margin at 12.1% and PAT margin at 6.1%.

Outlook and guidance

• Management expects growth to return in Q4 FY26, with next year anticipated to be much better.

• Full price corrections have been passed on to customers post-GST cut, with no margin impact expected.

• CapEx guidance is ₹100-150 crore for this year and next, focused on operational efficiency and modernization.

• Advertisement spend is expected to be around 4% of revenue.

• Indian footwear market expected to grow at 10.1% CAGR through 2033, with organized segment share rising from 35% to 45% by 2034.