Rupa & Company Limited (NSE: RUPA) Q1 2026 Earnings Call dated Aug. 13, 2025
Corporate Participants:
Unidentified Speaker
Mr. Vikash Agarwal — Whole-time Director
Sumit Khowala — Chief Financial Officer
Analysts:
Unidentified Participant
Prithvi Vora — Analyst
Darshan Jain’s — Analyst
Isha Mehrotra — Analyst
Raj Patel — Analyst
Shubhankar Gupta — Analyst
Anik Mitra — Analyst
Presentation:
operator
SatSatSatSA Ladies and gentlemen, the call will begin shortly. Please stay connected. Foreign. Ladies and gentlemen, good day and welcome to Q1FY26 earnings conference call of Rupa & Co. Ltd. Hosted by MUFG in time. 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 the conference call, please signal an operator by pressing STAR and then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Omkar Bhagwe from MUFC in time. Thank you. And over to you sir.
Unidentified Participant
Thank you. Good afternoon to everyone and thanks for connecting with us on our first con call for this financial year. On behalf of Rupa & Co. Ltd. I’m delighted to welcome you all to this call. Thank you for taking the time out on this call to discuss our latest results and financial performance. To discuss our results we have from the Management Mr. Vikash Agarwal, Full Time Director and Mr. Sumit Kovala, Chief Financial Officer. They will take you through our results and then we will proceed to question and answer session. Before we proceed, a small disclaimer.
This conference call may contain some forward looking statements about the company which are based on the beliefs, opinions and expectations of the company. As on the date of this call the actual results may differ materially. This statement are not the guarantee of future performance and involve risk and uncertainties that are difficult to predict. A detailed safe harbor statement is also given on page two of the company’s investor presentation. Now I would like to hand the call over to Mr. Vikash Agarwal. Thank you. And over to you sir.
Mr. Vikash Agarwal — Whole-time Director
Thank you. Good afternoon ladies and gentlemen. On behalf of Rupa & Co. Ltd. I extend a very warm welcome to all the participants joining us today for our Q1 financial year 26 results on call. We appreciate your continued interest in our company and I trust you have gone through the financial results and investor presentations uploaded on the stock Exchange. The first quarter of financial year 26 was marked by a complex industry environment with intense competition intensity and significant pricing pressures. The ongoing price undercutting in the market has increased price sensitivity among trade partners and coupled with our strategic decision to maintain price discipline infringed our top line performance for the quarter.
Revenue for the quarter stood at 184 crore compared to 210 crores in quarter one financial year 25. While overall volumes were subdued from pressures in the market that impacted primary uptake, our athleisure category continued to deliver strong momentum. This validates our strategy of investing in fast wing consumer segments. EBITDA for the quarter was 12 crores with an EBITDA margin of 6.6%. The EBITDA for the quarter moderated primarily due to higher branding and advertising spends of 21 crore representing 11.5% of the revenues along with under absorption of administrative and other expenses. On lower revenue base for the quarter, we remain focused on cost discipline and driving operational efficiencies.
To offset these impacts, our export business maintained positive traction growing by 10% year on year. Modern trade remains stable contributing 15 crores accounting for 8% of revenues. With the business continuing to remain an important channel for future growth. Operational cash flow for the quarter was 33 crores as on 30 June 2025. We maintained a robust net cash and cash equivalent position including investment of 53 crore. These reflect our prudent working capital management and financial discipline even amid a challenging industry environment. On guidance front during Q2 we expect to regain the volume deficit of Q1. However, due to intense pricing competition in the industry, we expect margin to remain under pressure.
The EBITDA margin is expected in the range of 8 to 9% for the coming quarter. While in short term pricing pressures in the industry will continue to weigh on margins, our disciplined approach to pricing will remain integral part to sustain brand equity and profitability over long term. We are actively enhancing channel efficiency, defining our product mix and accelerating innovation to meet evolving consumer preferences. With focused investments in high potential categories, we are confident in our ability to navigate the current environment and deliver sustainable growth over the medium to medium to long term. With this I would like to hand over to our CFO Mr.
Khoala for the financial highlights over to you.
Sumit Khowala — Chief Financial Officer
Thank you sir and good afternoon to everyone. Thank you for joining us on quarter one FY26 funding score. I will take you through the financial performance for quarter one FY26. Revenue from operations stood at 184 crore compared to 2210 crore in quarter one FY25 registering a decline of 12.6% year on year. Gross margin for the quarter stood at 37.7% which increased by 140 basis point as compared to corresponding quarter last year EBITDA for the quarter stood at 12 crore versus 18 crore in the corresponding period last year the EBITDA margin stood at 6.6% for the quarter.
Net profit for the quarter crore as against 10crores in Quarter 1 FY25 translating to a PAT margin of 3%. Our working capital as on Quarter 1 FY26 stands at 763 crore as compared to 811crores in March 2025. We are a cash positive company with a robust cash surplus of INR 53 crores as compared to INR 24 crores in March 2025. With this I open the floor for questions and answer session. Thank you. Thank you everyone.
Questions and Answers:
operator
Thank you very much. We’ll now begin the question and answer session. Anyone who wishes to ask a question may press star and one on your 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 will wait for a moment while the question queue assembles. The first question is from the line of Prithvi Vora from SAS Capital. Please go ahead.
Prithvi Vora
Yeah. Thank you so much. So I have a question that since you have heavily invested in the marketing expenses in Q1FY26. So what is your yearly guidance on marketing expenses?
Mr. Vikash Agarwal
6 to 7%, ma’. Am. On the top line.
Prithvi Vora
Okay. Thank you.
operator
Thank you. The next question is from the line of Darshan Jain from RJ Investments. Please go ahead.
Darshan Jain’s
Hello. Am I audible?
Mr. Vikash Agarwal
Yes.
Darshan Jain’s
Yeah. Thank you for taking my question. I just have one question. Would you take any price hike this year.
Mr. Vikash Agarwal
For the time being? Like raw materials are also under pressure and the market scenario is quite competitive. So at least for two quarters we don’t see that and we don’t know if there’s a certain hike in raw materials we might. But at the moment and it looks unlikely.
Darshan Jain’s
Okay. All right, sir. That’s all from my side. Thank you for answering my question.
operator
Thank you. The next question is from the line of Isha Murthy from MN A Ventures. Please go ahead.
Isha Mehrotra
Hello sir. So my question to is like what is your capex plan for the coming year, the current year, financially 26.
Mr. Vikash Agarwal
There is no major 15 to 20 crore.
Isha Mehrotra
Okay. And also I saw your PNL and the subcontracting expenses in the Q1FY26 is on the higher side. So can you provide the reason for the same?
Mr. Vikash Agarwal
Ma’, am, if you see the Absolute number of Quarter 1 FY25 and Quarter 1 FY26 the absolute numbers are more or less. And just due to the decline in revenue, the percentage is showing on a higher side. But nevertheless, the subcontracting expenses is related to inventory. Whatever subcontracted subcontracting expenses incurred is a means, is a part incurred Become the part of inventory.
Isha Mehrotra
Okay. Okay. Thank you.
operator
Thank you. The next question is from the line of Raj Patel from RK Securities. Please go ahead.
Raj Patel
Yeah, I’m audible.
Mr. Vikash Agarwal
Yes.
Raj Patel
Yeah. Thank you for the opportunity. Just two quick question from my side. So I wanted to know what would be the thermal order book size for this year?
Mr. Vikash Agarwal
Yeah, we are receiving a good orders for thermal as of now. And we expect that we should grow by 5 to 10% in quarter two against the last last year. Quarter two.
Raj Patel
Okay. And what will be our current working capital days?
Mr. Vikash Agarwal
The current working capital daily is 223 days.
Raj Patel
Okay. That was all from my side. Thank you.
operator
Thank you. Before we take the next question, a reminder to the participant. Anyone who wishes to ask a question may press star and one on their touchstone telephone. The next question is from the line of Shubhankar Gupta from Equity Capital. Please go ahead.
Shubhankar Gupta
Hi sir, I just want to ask two questions. First is modern trade is not picking up. And we also saw that there was a huge in the brand development cost which was around 21 crores. Right? So despite meeting such expenses why has modern trade not picked up in the in whole one year?
Mr. Vikash Agarwal
Modern trade means this quarter shows a stable performance. But we are quite hopeful that we’ll achieve a turnover of 80, 90 crore from this channel. And the demand is. We are seeing that the demand in this quarter is picking up.
Shubhankar Gupta
Okay. But still like 21 crores being spent in one quarter. And despite that let’s say you know like channels are not picking up. So that’s what I think. One concern from mind like where did we exactly deploy 20 crores? Is something which I was interested to ask.
Mr. Vikash Agarwal
21, 21 crore constitutes the celebrity payment also. And this will be rationalized in quarters to come. So our yearly target remains from 6% to 7% of revenue. So it will be rationalized.
Unidentified Participant
Hello.
Unidentified Participant
Hello.
operator
So the line for the current participant has been disconnected. We will move on to the next participant. Before we take the next question, a reminder to the participants. Anyone who wishes to ask a question may press star and one on their touchstone telephone. The next question is from the line of Shubham from Equity. Please go ahead.
Shubhankar Gupta
Hello, sir. Am I audible?
Mr. Vikash Agarwal
Yes.
Shubhankar Gupta
So I just have two questions. The first one being how are you looking to increase the market share of the women categories which seems to be a more sticky category.
Mr. Vikash Agarwal
We are working on the same and we are introducing lot of new products also. So it’s probably taking up some time. But we are working on the to put up the strong foundation for the Category to pick up. Okay.
Shubhankar Gupta
And the second question being how much does the ecclesia contribute sector contribute and how all the margins were.
Mr. Vikash Agarwal
Athena contributes almost 15% of the total revenue this quarter. And the margins are higher than innerwear, Quite higher than innerwear.
Shubhankar Gupta
Okay, could you quantify if possible in.
Mr. Vikash Agarwal
Second gross margins for this athyllis airware comes around 35 to 40%.
Shubhankar Gupta
Okay, thank you so much.
operator
Thank you. The next question is from the line of Shubankar Gupta from Equity Capital. Please go ahead.
Shubhankar Gupta
Actually sorry, I was disconnected. So I had one question on the, on the competition bit. So you know Dollar has seen a growth of around 40% versus we having a degrowth around 40%. So just want to understand what are we doing to upload, catch up on. The growth.
Mr. Vikash Agarwal
Get you.
Shubhankar Gupta
So what I’m saying is the competition has done well visually us in this quarter. So what are we doing strategically to uplift, uplift, slash, catch up on the growth bit.
Mr. Vikash Agarwal
So in quarter one our thing was to maintain the price and all to you know, for the long term profitability of the company. But seeing the competition, they have all. Gone for the price war. So the strategy is very simple. Like the competition is doing price work which is like 4, 5% and more your schemes and price cut in the market which we need to compromise on our long term policy for a short term where we need to of course maintain our top line. So this quarter probably as mentioned in my opening thing also in quarter two we’ll be able to cover up the deficiency and probably close on a, on a growth number.
Shubhankar Gupta
So is it possible to share the ASPs for let’s say our economy or mid premium segments so that at least we know by how much dollar is undercutting.
Mr. Vikash Agarwal
Dollar. We cannot comment on dollar numbers but.
Shubhankar Gupta
Our numbers, dollar numbers are there.
Mr. Vikash Agarwal
For our economic Segments ranges from 45 to 50 rupees. Mid premium segment ranges from 85 to 90 rupees. And premium segment ranges from 110 to 115 rupees.
Shubhankar Gupta
Okay, okay, got it, got it. So, okay, that’s from my end.
Mr. Vikash Agarwal
Thank you.
operator
Thank you. The next question is from the line of Anik Mitra from Phenomic Solution Private Limited. Please go ahead.
Anik Mitra
Am I audible, sir?
Mr. Vikash Agarwal
Yes,
Sumit Khowala
yes,
Anik Mitra
yes. Good afternoon sir. I have two, three questions, sir, regarding your raw material procurement strategy. I have seen like there is a cyclical approach means in the June quarter like the raw material procurement cost is the highest, it’s around 60, 70%. So can you clarify like how does it like do you consume more In June quarter and whether do you consume more in the June quarter or how does it go actually for you?
Mr. Vikash Agarwal
For raw material consumption means for quarter two and quarter three we have to keep stock for thermal. So preparations of thermals for winter wear has been started. So that’s why raw material high cost. Raw materials are there for in quarter one. But for the gross margins in quarter one are low compared to other three quarters.
Anik Mitra
Yes. Okay. Okay. Got it. Sir, you have one exceptional item. Can you please clarify what this licensing surrender of the license you have mentioned in your note previously.
Mr. Vikash Agarwal
We have two license brand FCUK and Fotl brand. We have surrendered that license. This exceptional item related to the settlement of creditor of Archwell license brand business undertaking which license has since been surrendered Now.
Anik Mitra
Got it, sir. Sir, and what is the ratio of your premium, semi premium and mass product in the value term.
Mr. Vikash Agarwal
Means the economics economic Segment contributes approximately 30 to 32. 30 to 32% premium segment. Consider around 55 to 60% and rest is premium segment.
Anik Mitra
Sir. 6 semi premium. How much did you say?
Mr. Vikash Agarwal
55 to 60%.
Anik Mitra
55 to 60. Thank you. Thank you. That. That was from my side.
operator
Thank you. In interest of time, this would be the last question. I now hand the conference over to Mr. Omkar Bhagwe from MUFG in time for closing comments.
Unidentified Participant
Thank you for joining us on the call today. I would like to thank the management for spending the time and answering all the queries today. We are from MUFG in Time Investor Relations Advisors for Rupa and Company limited. For any queries, please feel free to contact us. Thank you everyone and have a great day.
Mr. Vikash Agarwal
Thanks.
operator
Thank you. On behalf of Rupa & Co. Ltd. That concludes this conference. Thank you for joining us and you may now disconnect your lines.