Aditya Vision Ltd (NSE: AVL) Q1 2026 Earnings Call dated Aug. 01, 2025
Corporate Participants:
Unidentified Speaker
Yosham Vardhan — Promoter and Whole Time Director
Yashovardhan Sinha — Promoter Chairman and Managing Director
Analysts:
Unidentified Participant
Devanshu Bansal — Analyst
Aniruddha Joshi — Analyst
Rehan Saiyyed — Analyst
Madhur Rathi — Analyst
Renjith Sivaram — Analyst
Rajiv Bharati — Analyst
Yash Sonthaliya — Analyst
Manoj Gori — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Aditya Vision Limited Earnings Conference call hosted by MK Global Financial Services Limited. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing 100 on your Touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Diwanshu Bansal from MK Global Financial Services Limited. Thank you. And over to you sir.
Devanshu Bansal — Analyst
Yes. Hi. Good evening everyone. I would like to welcome everyone on the call and thank AVL’s management team for giving us this opportunity. We have with us today Mr. Yasho Vardhan Sina, chairman and managing director and Mrs. Yoshim Vardan, full time Director. I shall now hand over the call to the management team for the opening remarks. Over to you Sir.
Yashovardhan Sinha — Promoter Chairman and Managing Director
Thank you. DevonShu Good evening ladies and gentlemen. Welcome to ASIC Tuition’s Q1 FY26 earnings conference call. Our earnings presentation and financial results for the quarter have been uploaded to the stock exchanges. We trust you had the opportunity to review them. This quarter witnessed one of the most unusual summers in entire history of 26 years of ADIT division with unusual rains continuing throughout Q1 with no heat waves in our core markets of Bihar, Jharkhand and Uttar Pradesh May. In fact May 25 was the coldest in over six decades across India. You may like to compare the rain and temperature as mentioned in investor presentation which will show the tough conditions as encountered by this sector.
In fact to tell you rainfall during March to June was 198mm compared to average of 145mm in UP. In Bihar it was 223-223mm compared to 157 average and Harkan it was 215mm compared to 155 average. So you can see the difference in this period. Similarly, temperature during March and June in current year in UP it was 35.1 as compared to 37.6 degrees Celsius in Bihar it was 34.8 in current year compared to 37 degrees centigrade average. And in Jharkhand current year it was near 34.5 degrees Celsius whereas average was 36.4 degrees Celsius. As a result, demand for the seasonal cooling products plummeted in line with the broader industry trends for retailers and OEMs.
Leading OEMs in the cooling category reported a 15 to 30% decline in primary sales due to sharp buildup of channel inventory, particularly across India on start of summer season. However, even under these circumstances and challenges beyond our, our or anyone’s control, I am happy to inform our shareholders that our revenue grew 6% year on year over a strong Q1 FY25 base to Rupees 940 crore, highlighting our strength of fusion and adaptability to adverse situations. Despite elevated fixed costs associated with the 29 new stores launched in trailing 12 months which are expected to normalize as they mature, I’m really happy to report that we have maintained EBITDA margins at 9.5% and our profit after tax grew by 4% to 55 crores compared to 53 crores.
YoY. Our gross margins improved from 15.22% to 15.33% YoY. This was a result of our proactive steps to manage profitability. We rationalized non critical operating expenses including advertisement, promotional spending, warehousing, freight and security expenses while preserving front end service quality. This measured, focused and precise cost control ensured operational stability throughout this freak season. Amid external softness, internal discipline played a decisive role anticipating a strong summer air conditioner sales. As you are aware, we proactively stopped inventory at the end of Q4FY25 to mitigate potential compressor shortages and benefit from early season OEM discounts. However, as demand softened, our teams responded swiftly driving selective sales through targeted promotions and engaging OEMs early to provide support in liquidation of excess inventory.
This agile approach helped reduce our inventory levels by 150 crores in Q1FY26 compared to March 25 and your company remains comfortable on stocks of AC which has now come to companies historically normal levels. We also saw a meaningful improvement in our capital position due to effective inventory liquidation, robust receivable management and disciplined procurement. The short term borrowings declined sharply from rupees 278 crores in March 25 to approximately 115 crores as on 6-30-25. Our retail footprint continues to expand in line with our long term Strategy. We opened four new stores during Q1 consistent with our strategic quarterly pace.
I am pleased to share that we have added three more stores in July 25th taking our store count to 182 as on date. We remain on track to add 25 to 30 new stores in FY26 aiming to cross the 200 plus store milestone by year end. Our presence in central Uttar Pradesh including Lucknow has deepened, further strengthening our reach across key cities of up. Looking ahead we remain optimistic. India’s economy is expected to grow by 6.4% in FY26 supported by rising rural incomes, public capex momentum and improving consumer confidence. The Union Budget 2025 personal tax relief is expected to release rupees one lakh crore into consumers hand should provide a strong tailwind for discretionary retail during the first two quarters in Bihar as I speak, effective today the 125 unit free electricity Scheme has been launched by the government which will boost consumer durable and electronic demand and support overall consumption.
It will further enhance the disposable income in hands of consumers and will psychologically lead them to buy products driven by electricity. While Q1 brought unforeseen external challenges, our fundamentals remain solid. A reflection of audit provision, maturity, resilience, resurgence and consistent execution. And we hope that this pent up demand is we are going to reap the harvest in next FY Q1. So now I will. Now I will hand over the floor to Mrs. Yosam Varden to provide an overview of the financial highlights for the quarter. Over to you Yosam, are you there?
Yosham Vardhan — Promoter and Whole Time Director
Thank you sir and good evening ladies and gentlemen. We are pleased to report a stable financial performance for the Q1 of FY26. Let me take you through the key highlights. Revenue for Q1FY26 stood at 940 crores reflecting a year on year growth of 6% compared to 889 crore in Q1FY25 gross margin saw improvement at 15.3% up from 15.2% in the same quarter last year. EBITDA for the quarter stood at 90 crore with EBITDA margin maintained at a healthy 9.5%. Profit after tax came in at 55 crore registering a 3.9% increase over 53 crore in Q1 FY25.
Our retail footprint continues to expand. As of June 30th, 2025 we operate 179 stores. 113 in Bihar present across all 38 districts. 30 in Jharkhand covering 21 of 24 districts. 36 in Uttar Pradesh where our brand continues to gain strong traction. In Q1FY26. Bihar remained our largest revenue contributor at 76% followed by up at 13% and Jharkhand at 11%. Same store sales growth for Q1FY26 stood at minus 4%. We also witnessed a reduction in inventory by 150 crores compared to March 2025 and reduction of short term borrow from 278 crore in March to approximately rupees one hundred and fifteen crore as of June 30th, 2025.
Thank you for your continued trust and support. We now open the floor for questions.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may please press star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Aniruddha Joshi from ICICI Securities. Please go ahead.
Aniruddha Joshi
Yeah. Thanks for the opportunity sir. So regarding the air conditioner means essentially air conditioner, refrigerator, air cooler and fans. So on the summer products what will be the inventory and what will be the plan to in a way reduce the more than normal inventory. Also whether the brands are offering any support to us. We heard that the air conditioned market offering free installation also or like number two number three players are also offering discount. Some discounts. So. So how are we on that front? So that is question number one and then question number two is the BE norms will change in air conditioner in January means rather from January.
So we will have to finish off. All the inventory I guess by end of December itself. So considering only five odd months left. So which are anyway monsoon and winter months. So what will be the strategy of the company to. To work towards the reduction in the inventory.
Yashovardhan Sinha
Thank you for the question. As far as inventory is concerned I have already spoken in my earning call that we have reduced our inventory to the tune of 150 crore. And on the AC front also we are at a very normal level which is a historical level for our division with so many stores. So we are quite comfortable with our stocking of ac. And it’s not a cause of concern at all. As per our strategy we in fact from mid May we started destocking. And right now again what you said that whatever stock is less left.
Question number second is that BIS will be applicable from January next year. So actually we are not barred from selling whatever we are will be carrying at that period. The only manufacturer OEMs cannot. They cannot manufacture product which is not BIS as per government guideline. So we are not stuck up with any product even if not otherwise also you are not going to sell all the ACs even placed as on display on your showroom. And when you are having let us say 180 plus showrooms. So everywhere you have to keep the AC. Whether it is even if it is a winter or something.
Because when the customers they see it, then only they come to buy it when the season arrives. So that way we are. I don’t think there will be any chance talent and as you said that OEMs are very flexible in this regard. In fact, they were very supportive. It will not be proper for the company to divulge what support we actually get from OEMs. But I will say that substantial support has been provided by all EMS to us so that we can liquidate our AC inventories. And we are quite satisfied on that front.
Aniruddha Joshi
Okay, sure, sir. Just in terms of the stores now, we have rolled out only four stores in Q1, but I guess we have rolled out three stores in July month itself. That’s right.
Yashovardhan Sinha
Absolutely.
Aniruddha Joshi
Okay. Okay. Sure, sir. That’s it.
Yashovardhan Sinha
So as we know, as you must be aware, strategically we opened less stores in Q1 because. Because of lean season. Entering into lean season and then we start building up our store count.
Aniruddha Joshi
No. So just. Just wanted to reconfirm. Thank you. Thank you, sir.
Yashovardhan Sinha
Thank you.
operator
Thank you, sir. The next question is from the line of Rehan Sayed from Prenetra asset managers. Please go ahead.
Rehan Saiyyed
Hello. Not getting audible.
Yashovardhan Sinha
Yeah, it is now clear.
Rehan Saiyyed
Yeah. My question is focused towards the upcoming testing season. So how do you view potential demand given the upcoming festive session and strong so far.
Yashovardhan Sinha
Again, again, I’m not able to hear you.
Rehan Saiyyed
Okay, I’ll speak a bit slower.
Yashovardhan Sinha
Microphone or you speak slightly loudly.
Rehan Saiyyed
Okay. How do you view quarter two demand given the upcoming festive season and share monsoons of ours? Are you seeing any early pickup in the pre festive orders for football time?
Yashovardhan Sinha
It is in fact, I’ll say it is too early for us to comment on that. Festive season will start in late September. This is very early this year. Prestige season is going to come. I think Mahalia will be in September itself. So we’ll be preparing ourselves by end of this, before the end of this quarter for that. And as far as demand is concerned, I’m very optimistic that because of good rains, as you have seen very good rains and probably 10% more crop has been sowed. So I think that bumper harvesting will be there in entire geography where we are operating.
So I think given that the human was not that good. So people will be having so much of disposable income with them and I think festive season should be really very well.
Rehan Saiyyed
Oh, okay, sir. Okay. And my second question is around your scene sharp jump in driving a quarter. Could you highlight how much of it this was due. In quarter on quarter basis. So could you highlight how much of this was driven by volume growth versus price hike or average selling price increase?
Yashovardhan Sinha
You are aware that in Q1 this is summer season and AC AC contributes higher. So our contribution for AC in 26 was around 42 42% of our entire revenue.
Rehan Saiyyed
Oh okay. Okay, last one more question is around like last last. Lastly, what are the 2, 3 focus areas for the management team in the second half?
Yashovardhan Sinha
What are the focus areas? Our focus area will be to how to enhance our presence everywhere and and boost sales. This will be our primary.
Rehan Saiyyed
Like my. If I clarify more like apart from vre, are you focusing toward any other geography or any other states?
Yashovardhan Sinha
No, no, we are expanding right now. We are. Our focus is up and we are not right now focusing any other state.
Rehan Saiyyed
Okay, and what was the.
Yashovardhan Sinha
You are not capex for what you said repeated for.
Rehan Saiyyed
For this year. For this year.
Yashovardhan Sinha
We have already guided that we’ll be opening around 2530 stores in this area.
Rehan Saiyyed
Oh sorry sir, like.
Yashovardhan Sinha
Thank you.
operator
Thank you sir. The next question is from the line of Devanshu Bansal from MK Global Financial Services. Please go ahead.
Devanshu Bansal
Yes sir. I just wanted to better understand the steps that have gone or initiatives that have gone behind these stable EBITDA margins. As you mentioned that obviously retail comes with higher fixed costs and there were new store additions over the last 12 months as well. So if you could just throw some light on the key initiatives that we have taken and are these sort of sustainable or with return of sales growth, these expenses should also sort of come back to the previous levels.
Yashovardhan Sinha
Actually I’ve already spoken in my earning call that we when our top line was we could understand that top line cannot improve because of the weather. So we were very much focused on our expenses operating. So we try to keep it as minimum as possible as you know if sale is not there. So there are so many bonuses and incentives, these are also not there for so that has also cut down on our expenses and more so vendor sale is not like we are used to grow at a 30 but not grown at that level in this quarter.
So our entire cost on freight, security, expenses, warehousing, sale, promotion, everything has come down. So these things have been effectively managed by us and keeping in view that we have to see the bottom line as well. And if we are not able to increase the top line, at least our bottom line should remain stable. So these are the key factors and once we are on our track of on our track of high growth, then again these expenses are going to Go up.
Devanshu Bansal
Understood. Understood. Fair enough. Secondly sir, you did provide that gross Debt is around 115 crore. Can you also highlight what is the cash level at Q1. And that will be really helpful.
Yashovardhan Sinha
In fact if you take entire FD and cast whatever cash is cash equivalent with the complaints have down 141 crores.
Devanshu Bansal
Okay, okay. Okay. Fair enough. So whatever cash inventory reduction has happened has helped to sort of lower down our debt levels. Right? So that is the right understanding.
Yashovardhan Sinha
And there has been a nice cash flow also. Positive cash flow also.
Devanshu Bansal
Yes. Pretty encouraging to hear that sir. That’s all from my end. Yeah.
operator
Thank you. Sir. The next question is from the line of Madhur Rati from Counter Cyclical Investment. Please go ahead.
Madhur Rathi
So thank you for the opportunity. So I wanted to understand the inventory that we have as of Q1FY26N versus what it was in Q1FY25.
Yashovardhan Sinha
And I may not be able to tell you about last year’s inventory level. But what I remember it must be around 380 400. It must be around 380 odd crores. And in this year. This year it will be if you subtract 6 minus 150. So it will be around 548 crores.
Madhur Rathi
Got it. So do we like foresee. We mentioned that we focus on discounting to get our AC stocks to normalize levels. So do we. So I wanted to understand two things regarding that. Sir. Do we expect any further discounting over the next three four quarters or interest cost burden that you can expect? Correct Or. And the second question was. Yes sir. Sir, that was my question.
Yashovardhan Sinha
I’m afraid Madhu, you will have to repeat the question.
Madhur Rathi
Yes sir. I wanted to understand regarding this inventory level.
Yashovardhan Sinha
Can you speak slightly. Can you speak slightly louder please?
Madhur Rathi
Yes sir. Sir, is my audio better right now?
Yashovardhan Sinha
Ah yes. Now it is much better.
Madhur Rathi
Yes sir. So I wanted to understand. You mentioned that we focused on a little higher discounting to get our AC stocks to normalized levels. So what was the impact of that on our margins? So was it 0.5% 1% on our margins? And the second question was this inventory that we have currently. So do we expect some kind of either discounting cost or interest cost burden over the next few quarters to hit our books or we expect. We are fairly comfortable with that.
Yashovardhan Sinha
But I think I never. Madhu, I never said that we resorted to discounting. I do not know where you have got this word from but we never resorted to any discounting. We. In fact we took all the support from OEMs where like as you know how they support, they give free installations and they give various other facility to the customers. So these are the things. But discounting is not by discounting. There was no need for it to give any discount that way. And secondly, in future also when I. When I am telling you that we are at a comfortable level of the stock in air conditioner so we need not go for discounting or we are very comfortable.
We aren’t desperate to liquidate our stock.
Madhur Rathi
Got it. So that was from myself. Thank you so much and all the best.
Yashovardhan Sinha
Thank you.
operator
Thank you sir. The next question is from the line of Ranjit Shivaram from Mahindra Manualized mutual fund. Please go ahead.
Renjith Sivaram
Yeah, hi. Am I audible?
Yashovardhan Sinha
Yes, Ranjit, please go ahead.
Renjith Sivaram
Yeah. Yeah. Hi. Congrats on a decent performance despite the headwinds. I just wanted to know what was your sales store sales growth if you have that number?
Yashovardhan Sinha
Yeah, I’m having that number. Same sales store growth has been negative 4% in Q1FY26 which was at 21% last year. Q1FY26. So it is a negative figure of 4% SHG.
Renjith Sivaram
Okay. So despite having a very bad sales growth is only negative 4%. Like we were able to sell other products apart from air conditioners. How were we able to manage that? Just wanted to understand because AC category would have fallen much higher than this, right?
Yashovardhan Sinha
No, no. AC has not fallen as such. I told you. AC contributed around 42% of our entire turnover. And there was a degrowth of only 2%.
Renjith Sivaram
Okay. Despite a bad summer in the same.
Yashovardhan Sinha
Yes. So our negative SSG just denotes that the other branches also performed which has been. Which opened after that period in training. 12 months.
Renjith Sivaram
Okay. Okay. And as far for the full year, how do you see the same stores growth for FY26?
Yashovardhan Sinha
Definitely I believe that we will be in positive territory. And given that we have got another three quarters with us and this all festive season, everything is coming very quickly. So we are quite confident and optimistic that remaining period will be good.
Renjith Sivaram
Okay. And overall guidance, have you given any number or any color?
Yashovardhan Sinha
I don’t think it will be any guidance can be given on my top line as of now.
Renjith Sivaram
Okay. Okay. But you are confident that it can. Be better than.
Yashovardhan Sinha
This is what I believe, Ranjit. And I don’t think you will differ with that. If rainfall has been very, very good across these central states. So there has been. There will be a bumper crop which is. Which is to come. And as. As you know that Mostly it is agrarian society entire this area. So I think that there will be considerable money with left with the customers. And given I told you that in Bihar also this is a unique in fact scheme. 125 units free. It is. It has been kicked off from today. So that will also give a psychological effect to people that.
Yes. Let us go and buy. We are getting free electricity. So these things. I think these will act as a headwind. Come. And of course considering that even personal income tax has been lowered. So these are. I think this will be really good as first good traction.
Renjith Sivaram
Okay sir. Thanks. And all the best for the remaining.
Yashovardhan Sinha
Thank you. Thank you.
operator
Thank you sir. The next question is from the line of Rajiv Bharti from Nuama. Please go ahead.
Rajiv Bharati
Thanks for the opportunity sir. In terms of inventory volume sold in Q1 this year versus last year, this quarter and similarly last quarter last year. And then in the remaining part of last year what was the volume sold and what is the inventory? AC inventory in particular which we are carrying right now.
Yashovardhan Sinha
Okay. I. I have already spoken that we are at a comfortable level. Like you have to have at least when it’s smaller showrooms you must have AC on the on display as well as you must have keep in your warehouse also minimum one plus one. So whatever our requirement is there with hundred and 180 branches and coupled with around 12 brands. We are in fact selling. So these all all together we are quite comfortable in that. So I don’t think there is any problem in any liquidation or any will be distressedly looking for any support.
Rajiv Bharati
So. So why I’m asking is if I heard you correctly. You said 548 crore is the inventory which is sitting in the system right now versus 380.
Yashovardhan Sinha
Yes.
Rajiv Bharati
And this you’re talking about across the brands. Right. If I attribute that this is a 44% growth. The network is not expanding by the same amount. And this I am ecs. I was thinking that in terms of ASP also wouldn’t cover for the delta. So there is some inventory which will get stuck. If we attribute that the proportion of inventory is in.
Yashovardhan Sinha
You should calculate by adding 29 stores in trailing 12 months. As well as another seven stores. Another five, six stores are to be opened. So we have to have inventory for those stores also. These things you will miss from the final print. But this is what will be required. So if you will add all the branches all together. And given the. In fact this is also. This is not end of the season for ac. This is just. We have Just started in August. If we are comfortable in July. In August also we AC sale is there around about not less than 10,000 ACs are sold in August also.
So I don’t think there will be any problem. And we have to keep that much of a stock for two August and September. And in these modern times AC has not become product for only summer season. In fact these days are selling around the year. Of course peak comes in Q1 and. But. And peaks out in July, August, September. So this is it. I don’t think there is a matter of concern.
Rajiv Bharati
So sorry to harp on this. If you can just specify Q1 versus full year volume. What is the ratio usually? I mean historically what is the ratio any AC volumes.
Yashovardhan Sinha
The entire AC to it will be more around 65%.
Rajiv Bharati
In Q1 right. Of the entire thing. Okay, got it. So other part is your Western up 4A1. How. How is the initial ramp up has been in let’s say year one performance versus how we have been in eastern UP. And also what is the right to win in Western UP because there are other guys also entering that micro market from western side.
Yashovardhan Sinha
So you must have seen from the investor presentation that we have already UP has surpassed the Dharkand as percentage of sales coming to other division. So of course this is. This. This corroborates our statement that UP is doing very well. So I can only say that yes UP has been doing well and now that we have expanded to Central UP and we further we are going to expand beyond Central UP towards West. We are getting good business.
Rajiv Bharati
That’s all for my time.
operator
Thank you sir. The next question is from the line of Ankar Godre from Stree Investment. Please go ahead.
Unidentified Participant
Also generally normally the 40% business of yours like the revenue and 50% profitability. Comes in the first quarter itself. So even that situation currently how the situation has been for the quarter one how you think the year could pan out as 40% revenue and 50% profitability comes in Q1.
Yashovardhan Sinha
Yeah, that’s I think of course it is going to have take its stall Q1 because Q1 we have been growing at the rate of not. Not less than 30% in past years. And this year as I said that this was totally different. It is a bit. Was a freak year Q1 altogether. So that will have its impact on over entire year’s performance. But we are quite confident that with branches network of around new 40, 45 branches we’ll be able to do much better than what we have got in last year in last year’s Q2, Q3 and Q4.
So I think these are going to help us in getting our top line right. But it is too early for me to tell you and give you any guidance.
Unidentified Participant
So what. What has been the contribution of the mature store and newly opened store this. In Q1.
Yashovardhan Sinha
that figure I am not having.
Unidentified Participant
So like if you can give like how much they are contributing.
Yashovardhan Sinha
It is ongoing thing all since we are a rapidly expanding company. So every. Let us say new stores are coming up regularly. So it’s very difficult for us to tell you that exactly. Whole year we can say but some. Some store have opened in the last month. Some open at stores in February, some in March and January, some open so it will not be a right situation comparison.
Unidentified Participant
Why I’m asking this question is because like just wanted to know how much they have how much the new stores have contributed so far in the top line and how much potential they have.
Yashovardhan Sinha
You can find from the what figures I have given you. In fact if our overall we have our increase sale has increased by 4.6percent so and. But our SSG has come down by minus 4 so you can easily calculate what contribution they have given.
Unidentified Participant
Okay. And you have guided for 200 plus stores in FY26. Like how can be the. Yeah. So just wanted to know beyond that do you have any target in mind for this division? How much stores can be added every year?
Yashovardhan Sinha
We are quite confident of adding 2530 stores but we are in fact we want to add even more stores because we are getting very good responses in new areas. But these are as always we have guided conservatively and we always say that it is there in the investor presentation also that will be adding to the minimum 25 stores every year.
Unidentified Participant
Okay. In the earlier presentations you had mentioned about what kind of growth rate you will be growing at. I don’t see that kind of target given in this presentation any.
Yashovardhan Sinha
As you know that we have been going what do you expect? What you take the past for the future. But if something goes wrong sometime which is beyond your. It’s not your hand. So this is. This was the quarter. I’ve been telling all that all the time. I gave you the figures also that how weather behaved strangely in this quarter. So maybe we may not be achieving our let us say guidance but we have always been guiding about 2025% of growth in sales which even now I our team remains confident of achieving.
Unidentified Participant
Okay. And what about the foray into.
operator
Mr. Uncle, may we request that you return to the question queue for follow up questions? Thank you sir. The next question is from the line of Yash Sontaria from N end Device Public Alternatives. Please go ahead.
Yash Sonthaliya
Hi sir. Thanks. Yeah. Thank you for giving me the opportunity. I hope I’m audible.
Yashovardhan Sinha
Yes, very much. Please go ahead. Yes.
Yash Sonthaliya
Yeah. So my question is related to our UP market. So two questions over there. First going ahead when we are seeing we are going to open 2025 stores and maybe 18 plus stores in this year. So what would be the proportion of. Tier 2 and below and tier 1 and above cities in this store expansion?
Yashovardhan Sinha
We are. Right now we are. We have been focusing a tier 2 cities only and that’s it. We are. We are already present in Lucknow and we are focusing in. I would rather not like to divulge what we are intending to. Where we are intending to open. That will not be in company’s interest. But mostly now this western UP will be our next place where we are going to open new stores.
Yash Sonthaliya
Understood? Understood, sir. And while you already alluded about the performance in UP right now are we giving any extra discounts or any anything extra gifts or offers to the customers which are impacting our margins in up?
Yashovardhan Sinha
Not at all. Yes. Not at all. Yeah. It is a basket. The margin comes in basket and UP behaves similarly as darkened or similarly almost similarly as Bihar.
Yash Sonthaliya
Understood? Understood sir. Really comforting hearing that sir. Best of luck for upcoming quarters. Thank you.
Yashovardhan Sinha
Thank you.
operator
Thank you sir. The last question is from the line of Manoj Gauri from Aquarius Capital. Please go ahead.
Manoj Gori
Yeah. Thanks for the opportunity sir. I think the overall performance has been somewhat assuring in the current environment especially on the inventory side. So my question is if I look at probably we have been guiding roughly around 20 25% growth. So obviously keeping aside our 1Q performance which is now gone and is behind us should we expect similar kind of growth probably from 2Q onwards for the rest of the year. Because now probably summers largely are done and should we expect similar kind of momentum from 2Q onwards?
Yashovardhan Sinha
Yes Manoj, definitely what you are saying is right. Q1 is behind us and of course Q1 was impacted by weather and AC was the key reason. And for Q2, Q3 and Q4 it will not be that dominant in our category sale. Yes, is. So we are very confident of achieving that.
Manoj Gori
Right sir. So secondly what I was also observing if you look at now we are opening more stores in non VR markets. So and when we. When I look at the Q1 margins as well on YY this is gross as well as EBITDA margin. Well as have been flattish so especially on the gross margin being flattish all the markets, key markets like UPBR and Jharkhand operate probably the product mix is largely similar.
Similar kind of pricing. This is the trend should we assume. In the coming year?
Yashovardhan Sinha
I think so, yes. And it is quite similar. This is what is the story all about for Aditir. Whatever we are in fact it is going to remain stable. All these this area of geography they behave in the similar pattern. So I think. I think in going forward in future also we are going to have the same category sales.
Manoj Gori
So lastly if I look at probably few quarters like we were talking about Chhattisgarh as the new market opportunity for us. And somewhere we were targeting to get into this market in FY26 or probably later into FY26. So currently at least for FY26 we are not getting into this market. And probably we will focus more on spending our presence into up. Is this understanding correct?
Yashovardhan Sinha
We cannot in fact right now we can commit it because we are looking at those markets. What you said Chhattisgarh market. So we won’t say that we will not be entering maybe in Q4 we may be entering in these markets. But right now what I said that right now we are not in fact expanding in such as of now. So. But it is a long way ahead. Just four months have elapsed out of 12 months. And so by end of this year I think we’ll take a call in Q4 to expand in Chhattis. But that definitely in our agenda.
Manoj Gori
Thank you sir. And wish you all the best for coming quarters and years.
Yashovardhan Sinha
Thank you Manoj.
operator
Thank you sir. Ladies and gentlemen, that was the last question for today. I now hand the conference over to management for closing comments.
Yashovardhan Sinha
I thank all of you who were attending the earning call and sparing valuable time. Thank you very much. Have a good time ahead. Thank you so much.
operator
Thank you sir. On behalf of MK Global Financial Services limited that concludes this conference. Thank you for joining us and you may now disconnect your lines.
Yashovardhan Sinha
Thank you.