Sai Silks (Kalamandir) Limited (NSE: KALAMANDIR) Q4 2025 Earnings Call dated May. 19, 2025
Corporate Participants:
Unidentified Speaker
Rachamadugu Balaji Bharadwaj — Senior Vice President
KVLN Sarma — Chief Financial Officer
Analysts:
Unidentified Participant
Ankit Babel — Analyst
Amol Rao — Analyst
Keshav — Analyst
Resha Mehta — Analyst
Sarvesh Gupta — Analyst
Harshit Khadka — Analyst
Niharika Karnani — Analyst
Anuj Kashyap — Analyst
Piyush Bangar — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to the Q4FY25 earnings call of Sai Silk Kalamandir. 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 then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Bharadwaj Rachama Dugu, the Senior Vice President. Thank you. And over to you, sir.
Rachamadugu Balaji Bharadwaj — Senior Vice President
Thank you, Alevin. Good morning ladies and gentlemen. A warm welcome to everyone present on this call. Thank you for joining us today to Discuss Saiss Kalamanda Limited results for quarter four as well as for full year FY25. I have with me Mr. K.V. ellen Sharma, the CFO of our company. Let me first start by giving you an update on the overall ethnic retail market scenario for quarter four. During the quarter four we had seen a decent number of wedding dates and a few festivals such as Sankranti and Ramzan that has led us to have a decent quarter.
There was a slowdown in the month of February compared to January and March. The overall wedding date in the quarter four were almost similar to that of the last year. For the full year. The Indian ethnic wear market as discussed in our earlier conversations as well has been weak especially during H1 due to the lack of wedding dates. Though quarter 3 and quarter 4 has shown recoveries in terms of the overall consumption, the calendar wedding dates have been more confined towards quarter three and quarter four. The upcoming quarters does have a decent pipeline of the wedding dates and and does have a distributed wedding date calendar which we are all excited about and believe that this could translate into better overall performance during the upcoming seasons.
Moving on towards our operational performance with regards to store expansion during the quarter we had opened close to 25,000 square feet of retail area with our premium format Varah Mahalakshmi Silks. We still remain to have no store closures taking our store count to 68 company owned company operated stores for the full year. We have added close to 67,000 square feet of retail addition this year taking the overall retail square feet area to 7,16,000 square feet spread across 20 cities and five states. On the strategy front, our retail store network in Tamil Nadu is improving and also we believe to add the upcoming stores through Varah Mahalakshmi Silk store network in the next year as well.
We are identifying other potential regions outside of Tamil Nadu as well to steer this expansion and growth. We are currently looking at adding another 65,000 square feet retail area in the next year during the quarter. Considering the changing dynamic conditions of the Indian ethnic retail market, especially what we have had during the half year first half we focus some of our efforts towards advertisements and especially digital marketing. We increased our advertisement spends to ensure we leave no platform unturned to have a positive impact on the awareness and brand recall value, especially because most of our Varamahalakshmi stores in the last year has been in newer cities.
We wanted to leverage the advertisement and create a brand value in the local specific points. Our efforts to utilize Salesforce CRM has also been effective in this full year and we anticipate to have a similar focus in terms of advertisement and CRM in the next year as well. We believe that when we move into geographies this will have a long term positive impact on the overall brands. For the year we have gained 18.5 lakh unique customers out of which 43% of our customers stood to be repeat customers. With respect to the financial performance for quarter four we did a revenue of about 399 crores compared to 360 crores for the same period last year showing a growth of about 11%.
Our our SSGs for the quarter remained minus 1.5% compared to quarter four of last year. The market is slowly moving towards a positive trend and we believe that this recovery should be strengthened in the next quarters to come as well since the first half of the year has been weak. We started off the quarter with a high Double digit negative SSGs that we had by the end of quarter one slowly started recovering to about minus 5% SSG by the end of the year. For the full year our revenue stood at 1462 crores compared to last year of 1373 showing a growth of about 6 and a half percentage.
Even during these challenging times we still continue to deliver better gross margins. We have delivered a gross margin of about 41.7% in quarter four compared to 40.9% in the previous year. For the full year our gross margin stood at 41.8% compared to 40.6% showing a robust growth of about 110 points in gross margin expansion year on year. In this year though, our PBT levels were almost similar to that of the last year. We had to make an income tax provision of up to 21 crores for the previous years and therefore our PAT levels were affected to that extent.
We are continuously studying and understanding the store and changing our products to meet the needs of specific locations, especially when we move into newer locations. By understanding the sale patterns and by learning customer journeys, we are using our ERPs and systems to continuously curate the right products curated from across the store. Though we believe that majority of our business does have an impact on the wedding date calendar, we are making additional changes in terms of products to ensure the dependency on the wedding dates and seasonality is minimized. Considering that the decent wedding calendar spread out in FY26, we at SSKL are very optimistic about the growth of our company in the next year as well as plan to expand our retail footprint into one of the biggest ethnic markets of retail India, not just confined to the five states of where we are currently present, to slowly start expanding into newer geographies as well.
We believe that our strategical focus combined with our technology adoption will help us create greater milestones in the years to come. I will now hand it over to the operator and would be happy to answer any questions that you may have.
Questions and Answers:
operator
Thank you sir. We will now begin with the question and answer session. Anyone who wishes to ask a question may press Star and one on their touch tone 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. A request to all participants. Kindly restrict yourselves to two questions in case. If you have any more questions you may rejoin the queue. The first question comes from the line of Ambala Krishna from Oman Investment Advisors. Please go ahead.
Unidentified Participant
Hi, good morning. So the first question is regarding this income tax lagging amount is 20 crores. So what is the reason behind this amount of 20 crores?
operator
I’m sorry to interrupt. Ambara, you’re not. You’re not quite clear. Please be a little more audible. You’re not quite clear.
Unidentified Participant
First of all this is regarding this 20 crores of income tax amount.
Rachamadugu Balaji Bharadwaj
So yes.
Unidentified Participant
So we are accumulated this amount for four years. So we can expect in 23, 24 also 2425 also same similar amount. So what is the root cause for this one? And the house is mismatch of accounting happened such a huge amount of at the company level and when it comes to promoter level the 50 crores more than 50 crores. That is I think 58 crores. That is too much. So what kind of issue was there and expect this kind of issues in future also could you please throw some light on that?
KVLN Sarma
Yeah. Good morning, I’m Sharma, CEO for here. So first up the company’s liability aspect. Well as you are all aware the raiders happened on the company during May 23rd for different reason, actually, where the initially the apprehension was about cash sales and all that having established fully complained on those aspects, then they went into other details. So broadly I will classify into two, three aspects where they disallowed the expenditures. One is during the initial periods of KLM Fashion Mall getting into a service that is approximately 2009, 1819 and 1920, the product profiling. As you are aware, by the till such time we were operating only on saris.
Whereas in KLM we had today do the different product profiling. So while doing that, we have taken purchases from various small, small vendors and all that who are not fully compliant. And that was the period during which the GST thing was also getting fully established. So in respect of those purchases from small small vendors, where we could not provide a last mile documentation in respect of purchases, in fact, we have already reversed the GST input credit much earlier. So those cases where we have reversed the input credit income tax department disallowed those purchases and added them to our tax liability.
And on a second aspect, during the COVID year, during the COVID year, we have kept all salary advances. I mean, we have paid the employees to the full extent during the lockdown period and others and kept them as advances in respect of staff. But by February, March, we realized that the second wave of COVID has also come. So we cannot insist on employees to repay all those amounts. So we have transferred all that to the salaries expenses instead of salary advances. So those amounts which were given to employees, which earlier was advances as expense, those things were disallowed by the income tax department.
And over seven, eight years, approximately every year there will be because we are in a retail area, retail business, there are a lot of small, small cash expenses that would go while maintaining the showrooms, etc. In which they have disallowed a part of the amount first seven years. So these three aspects put together there has been a liability has come to the extent of a total of 27 crores, of which last year itself we provided for about 6 crores, anticipating going by the assessments that were happening. So the final figures, including all that interest, etc.
Has come to 27 crores, of which last year 6 crores was provided. And this year the balance 21 crores was provided. So this is the final thing that will be that liability will be there. And going ahead, there will be only normal income tax and there will not be any tax relating to the earlier years. So it will be a normal functional year. So from year 25 onwards. And the old income tax thing that has happened is now close to the full extent promoters.
Unidentified Participant
Okay then promoter, what is the liability? 58 was how it’s been expanded.
Rachamadugu Balaji Bharadwaj
So on the promoter side what has happened is during, before, before even we went public I think in the year of 22 and 23 we formulated SSKL Family Trust because there were around five to six promoters in the overall equation. We wanted to ensure that everybody’s properties and assets are equally distributed. During that process of registration re registration there was a difference that the income tax department found with respect to the market value versus the book value. On account of those transactions being done which was a part of our transaction trust creation process. They have considered that these are amounts that needs to be like this is.
This is the gap that is there. So on that front I think we are working with the departments to ensure that that is going to be clearly waived off. We are working with them and we are. We are quite hopeful that that is just a transaction between one family member and the other family member on account of real estate. That that should not have much impact on the overall send. I think probably in this particular quarter even that should be completely paved off. I think we made an appeal to the department and in this quarter it should be closed on without having any financial impact.
Unidentified Participant
And.
Rachamadugu Balaji Bharadwaj
Sorry, I think your voice was breaking. Could you repeat again?
Unidentified Participant
No, but 27 crores income tax due which is there. So we are not appealing anything. We are going to pay that amount completely. Right?
Rachamadugu Balaji Bharadwaj
Yeah. Actually that we have agreed and this is the final figure after the negotiations. In fact you would appreciate that out of the 27 crore the interest component itself has come to approximately 13 crores. The tax liability is only in the range of 14 crores. And 13 crores is the income interest that has accrued on that. And this 27 crores is the final negotiated figure that we have agreed and concluded.
Unidentified Participant
Okay, understood. On the business side,
operator
I’m sorry to interrupt. I would request you to rejoin the queue.
Unidentified Participant
No, I just asked only one question.
Rachamadugu Balaji Bharadwaj
It’s okay sir, please. Sir, please tell me.
operator
Okay.
Unidentified Participant
Yeah, one last person. Business pointer. So what is the number of stores or square bits additions we are planning in this year? And I think it’s mostly located location in Tamil Nadu. Could you please throw an expansion plan?
Rachamadugu Balaji Bharadwaj
Yeah. So for this particular year I think the next coming year we are planning to aiming to at least open an effective retail square feet of about 65 to 68,000 square feet of retail addition average Varma Lakshmi Though we provisioned for about 5,000, I think 6,000 average taking. I think those are the kind of stores retail addition we’ll have open. With respect to these stores, I think we are going beyond Tamil Nadu as well. We are going in terms of tier 2 cities of Karnataka. We are looking at expanding into Maharashtra a little bit on the northern Andhra side as well.
So all of this putting into taking into consideration, we want to probably open around 65 to 68,000 square feet. And mostly I think probably 95 to 100 of these stores will be using our Varah Mahalakshmi sales format only.
Unidentified Participant
Okay, so this Q1. So. Last year was very muted. So this year also we are expecting any muted results in Q1. It could be a little bit better than last year.
Rachamadugu Balaji Bharadwaj
For the quarter one. Last year I think there were negligible wedding dates. I think this quarter one does have a decent pipeline of stores. I think at this point of time, I think we’ve completed close to 47, 48 days of our operations here. The results have been decent enough. We are seeing good results in stores. I think we are also seeing a good SSG level growth also. However, I would think at the end of June probably we’ll get a little bit more clarity. So far with our 46 days operations, we are seeing a good demand coming into our stores.
Unidentified Participant
Okay, thank you Dasa.
Rachamadugu Balaji Bharadwaj
Thank you.
operator
The next question comes from the line of Rushil from Pink Wealth Management. Please go ahead.
Unidentified Participant
Hello. Hello.
Rachamadugu Balaji Bharadwaj
Good morning.
Unidentified Participant
Yeah, hi. Good morning. Yeah, yeah. My question is that you know which we a core market which is Andra and Telangana. So I think over the last one year we have been seeing a muted demand over there. So what are the plans, you know, to get the demand back those geographies.
Rachamadugu Balaji Bharadwaj
So again Rushell, so what I would like to point out is majority of our degrowth once if you see look at our backwards, I think H1 on the lap of this wedding dates being there. The overall consumption also was weak in the last year. In quarter three though we did see a good.
I mean we’ve gained back a lot of these SSGs and we gained back this demand in Q4 again has a little bit of an impact. But there are basically two reasons why we believe that there is a slowdown. One is in the overall consumption level. There have been quite a few number of competitive stores people who have opened in this especially in the last three to four quarters in Andhra and Telangana that had some impact. But the other reason could be with respect to the shift of wedding dates. Barring these two things I think it is quite fair for us.
And yeah, so we are already starting to see this market share that we are trying to gain back in this 45, 46 days we are seeing a good SSG levels growth and I hope that this is going to continue. Majority of our degrowth particularly has been with respect to our KLM formats. Not everything apart from KLM format we are seeing a good, I mean the SSG levels are positive but KLM has been a little bit of a dragger. Two things that we are trying to work on with respect to KLM is to trying to correct the product.
We have seen some degrowth coming from the men’s and the kids wear category particularly per se. So we are trying to rework on the entire supply chain and procurement with respect to KLM side. So once this is done, which will probably be around by mid Q2 or by late Q2 then I think for the remaining half of the year klms also will be doing good. What we are aiming by the end of next year is at least we should be able to be at a flat to a small low single digit FSG level of growth is what we should be able to expect in this full year running of office.
Unidentified Participant
So if I have to put it that way that for the mature stores will be continue to maintaining SSG at a flat or slight positive level. Can we say that?
Rachamadugu Balaji Bharadwaj
So if you take KLMs particularly I think we have a close to about 10%. Sorry
Unidentified Participant
excluding KLM. If I just speak about let’s say for our SARI store format. So for the mature stores, so do we expect the SSD level at a flat or slightly positive growth
Rachamadugu Balaji Bharadwaj
for non KLM stores especially on the other formats we should be able to expect an SSG positive SSG levels.
If you take KLM also into consideration we are looking at a flattish to a small single digit SSG level growth by the end of this year. But with respect to non KLM stores I think we should be able to see a decent SSG level growth. That that is quite there
Unidentified Participant
at Telangana and Andhra Pradesh geography too sir.
Rachamadugu Balaji Bharadwaj
Yes, yes you’re right and I mean non Telangana Andhra early which is positive and that trend will continue. I am taking both AP and Telangana also into consideration and giving you this now.
Unidentified Participant
Okay. And has the competitive competition intensity has slowed down at Telangana and Andhra Pradesh?
Rachamadugu Balaji Bharadwaj
Yes, I think there is no new stores that we have seen opening up.
There are hardly like very very small players and like 2000, 3000 kind of mom and pop stores that are coming up but nothing majorly of the size of what our stores operate under. There’s not much that is being opening at this point of time. Whatever has been opened has been open in the last one year and the previous year.
Unidentified Participant
And sir, can you give us a breakup of the store formats if it is possible. Let’s say the Vara Malakshmi, you know, which is being a like major dominant store. So what sales we had done last year and what sales you know we have done this year in Vara Malakshmi format and can you just give us some guidance on that?
KVLN Sarma
Varma Lakshmi currently even Last year also FY25 was 50% of the total revenue against 1462 of total turnover. Approximately 710 crores is from Varma Lakshmi format.
Unidentified Participant
So next year I think we should expect a good growth. Just continue question. Just a continue question.
KVLN Sarma
Yeah, yeah, yeah yeah. So next year obviously the stores that have come in last year will give higher turnover and also we will be establishing another 50,000 square feet on a staggered manner during the year. So obviously Varma Lakshmi from Varama Lakshmi share in the entire turnover should substantially improve. In fact in Tamil Nadu while the metro Chennai stores etc are doing exceedingly well will be when they above the averages. We have taken a specific decision to create visibility in the catchment areas of the stores that have been put in B centers like Salem, Hosur, Coimbatore and all that.
And we are expecting that the advertisement additional advertisement expenses that we have incurred during quarter three and quarter four should give a better result and better productivities in these centers also. And once these stores are right now are in the maturity process and then when the higher productivity is achieved during these stores the component of Varma Lakshmi vis a vis the profitability of these stores will be substantially better than the current.
Unidentified Participant
So we can expect a better margin going ahead basis.
Rachamadugu Balaji Bharadwaj
Yes.
Unidentified Participant
Okay. Thank you sir. I’ll wait for the queue.
Rachamadugu Balaji Bharadwaj
Yeah,
operator
thank you. The next question comes from the line of Ankit Bubble from Sukhum Ventures. Please go ahead.
Ankit Babel
Yeah, good morning sir. I have a few questions. Now the first question is on your trade table. Sir, I was just observing it that the pre IPO you used to have a very high trade tables but post IPO you repaid almost all of them. But you know we have not seen any meaningful improvement in your margins post that. So just wanted to know the reason that pre IPO you used to have very high trade papers but post IPO the paper days have reduced drastically.
KVLN Sarma
The margin improvement will come only upon the sale of the product. So you will be able to see the improvement in margins on a staggered basis which will come out of this better payment terms and getting cash discounts, etc. So from the IPO time you must have seen that there is a progress on this front. On this front on a siloed basis and going ahead you will be able to see that.
Rachamadugu Balaji Bharadwaj
But I think on the overall as well, if you see our gross margin quarter on quarter, I think you have seen a quite agreed decent improvement. I think about 1 1/2 to 2% kind of an improvement pre IPO levels to now. I think the gross margin actually expanded sir. But as sir said, I think the payables will be done but only on the sale of products. The I mean once after the sale of the products is done, that’s when these particular gross margin improvement will come. Whatever the improvement you have seen in the last quarters to come, especially in this quarter has also been on account of this as well.
Ankit Babel
Okay, okay, okay. And the second was that your retail area was up around 10% in FY25 but your employee cost was up by 20%. Why was it so and what kind of growth we can see in this in FY26 in employee cost?
Rachamadugu Balaji Bharadwaj
I think majority of the reason is because of the negative SSGs. I think the employee costs are now shooting up. Otherwise that’s not going to be the case. Once we start having a normalized quarter, the employee cost should be in line with the normal store expansion. So this time I think this particular year you should be able to see the employee cost in the same percentage levels as a percentage previous year.
KVLN Sarma
It also is arises out of see there are if you can take approximately around 4 to 5% increase because of increments etc and then normally the store area is increased by about 15 16%. Varma Lakshmi has a higher staff cost so that is one of the reasons why there is. And thirdly when we are having stores, we are implementing stores say in the next one month, one and a half months time we will have three major stores opening and the staff is already recruited or under training at the existing stores. So this additional small cost on account of the future employees that are going to be operating the upcoming stores will also include and whenever the sales increase, the incentive that is given to the employees also is increased.
So it’s not exactly on a proportionate basis with reference to square feet area that we can relate it. But overall once the major store expansion is happening this will get adjusted there.
Ankit Babel
Okay sir. Lastly, what’s your guidance for FY26, top line growth and EBITDA margins. For the. Company as a whole at console level.
KVLN Sarma
Are we speaking about estimate?
Ankit Babel
Yeah. FY26, what kind of top line growth and EBITDA margins you are expecting for the company as a whole considering the retail area expansion and the SSGs in the different formats? Whatever you are expecting.
Rachamadugu Balaji Bharadwaj
But I think your voice is breaking. I don’t know if it’s just for us or for everyone.
Ankit Babel
Am I audible now? Am I audible? Am I audible now?
operator
Please come a little closer to your microphone. Ankit.
Ankit Babel
Yeah. Am I audible now?
operator
Yes.
Ankit Babel
Am I audible now? Yeah. Yes, sir. Just wanted to know what’s your guidance for FY26 in terms of top line growth and EBITDA margins? So top line growth after considering the retail store expansion and the SSGs in different formats, whatever you are expecting and the better margins considering the product mix because the share of Varma Lakshmi would be increasing. So considering all these factors, what kind of growth you are expecting and the margins.
KVLN Sarma
Yeah. See generally what as a corporate plan we thought we would given clear cut guidance in the second half. After the second half. First half. Because in the second half there may be some lag in the wedding dates and other things but overall the target that we are aiming at is in the range of about 15 to 20% both on the turnovers and proportionally a little better on the margins.
Ankit Babel
Okay. Okay. Thank you so much, sir. Thanks.
operator
Thank you. The next question comes from the line of Amol Rao from One Up Financial Consultants. Please go ahead.
Amol Rao
Good afternoon, Mr. Bhagwat, are you right when you said that for the whole year the SSG for the company was minus 5% or was it for a particular format?
Rachamadugu Balaji Bharadwaj
For the whole year for the company’s average is minus 5%.
Amol Rao
All right. So and I just wanted to confirm you said the wedding dates are a little more distributed in this year. Is it fair to assume there’s the same number of wedding dates as last year plus minus 5%.
Rachamadugu Balaji Bharadwaj
In terms of the number of wedding dates? Also more or less plus 5% is there in this particular year. But the more than the additional couple of days, the better thing that we are currently having is when you have a distributed calendar of wedding days spread across between not just one half of the year, but which is spread across more than like three, three quarters. What tends to happen is because the crowd that comes into stores, the customers that walk into stores, you’re able to service them better because it has, I mean because they are more number of dates or days that we can handle the crowd generally and historically in the company also this resulted in better performance throughout.
So that’s the kind of calendar we see in this particular year. If you take last year because H1 was completely negligible and everything moved to H2 though in terms of the date wise it has a decent number of dates. Everything getting cluttered into one particular quarter will have some sort of an impact in the overall performance performance. But that is not the case in this year.
Amol Rao
Understood Sir. And just 1, 1, 1 one more clarification. Did I hear you right when you all said that approximately 60 to 70000 additional square feet in this year mostly in the Varma Lakshmi format or entirely in the environment?
Rachamadugu Balaji Bharadwaj
No, in this particular year we are targeting the entire retail square feet addition to be in Varamahalakshmi square store itself. Maybe they could be provisioned for about a store of Kalamandir but 95% of the entire retail edition will be through Varamahalakshmi sales format and Varamahalakshmi sales format has been that format where most of our expansion is happening in the south India the market is better. I mean the customer also prefer more on the wedding sides. It’s one of our premium formats when you compare to the other four formats as well. So we are going ahead in this event channel also with Varma Hanakshmi only and that’s why you should be able to see a little bit better contribution in terms of the overall revenues and other margins and other operational leverage aspects as well.
Amol Rao
Thanks so much and wish you all the best.
Rachamadugu Balaji Bharadwaj
Thank you sir.
operator
The next question comes from the line of Keshav from Counter pms. Please go ahead sir.
Keshav
I’m trying to understand that since FY23 our revenue has hardly grown by 110 crores despite adding over 700 crore to our net worth. Basically net worth has like tripled but the revenue has not even grown by like 5% in the next in the two years since then sir. So basically it is a huge concern that where exactly the money has gone. And like the earlier participants said the fables have come down drastically without so from 230 crore in FY23 to 27 crore or thereabouts last year and there is no improvement whatsoever either on the top line or on the margin side.
Whereas the employee expense also if I understand correctly has gone from mid single digit to mid double digit like in the sense mid teens. So basically if you could just give us some overview that where exactly is the company going from here and what kind of capex are we planning to incur in FY26? And I did answer did I hear you correctly that this financial year we are expecting 15 to 20% revenue growth with margin improvement. So and also sir please tell us what are the our rentals as a percentage of sales. Thank you very much.
KVLN Sarma
Yeah. I will first address the network aspect. So since we have gone in for 600600 crore IPO so that entire thing got added to the equity. That is how you are seeing a jump in to the extent of 700 crore in the network. So while we are implementing with that money we are implementing addition of stores particularly Varma Lakshmi format. From the IPO’s time we have added approximately one 10,000 square feet of area on a staggered basis where the stores that have been put in metros here are doing exceedingly well and the beach center stores are operating slightly lesser than what we thought and we have identified that the issue.
And then Last year in Q3 and Q4 we have spent additional amounts on advertisement to create particularly in Varma Lakshmi format. As you know it’s not in the place where the store is established. There will be a catchment area to the extent of 75 to 100 kilometers from where people come and make purchases for the wedding. So we are creating visibility for these catchment areas. Also we have done we have spent amounts in Q3 and Q4 and some part will be done in this quarter as well so that we are expecting the higher productivities from these B centers also by the second half of this year where the calendar will be highly dense with festivals, visa festivals and the wedding dates also.
So we should see a quantum jump in the turnovers vis a vis the profitability from the second half of this year from the investments that have been made in expanding. As you are aware that we have already expanded to the extent of 1000 square feet as subsequent to IPO. So the amount has been spent on that and the asset is created and this will result in coming in fact H2 itself. Secondly we already we also have approximately 200 crores out of it for further spending. See we have not spent the entire amount and the expansion is not completely over.
So the expansion program will continue during this year also whereby we would be adding another 60,000 65,000 square feet area and once these come to once these stores start getting matured and delivering productivities as a normal Varma Lakshmi format even a company level average you can take it as 40,000 square feet then the quantum jump there will be a Quantum jump in the productivities the square feet per square feet productivities as also the total turnovers Once Varma Lakshmi improve Varama Lakshmi share of the total turnover improves Obviously the margin profile will improve much beyond the turnover improvement.
With regard to the employee cost as you know year 23 the employee cost was about 141 crores and after adding about 1 lakh square feet or so but the employee cost has come to 1 crore 195 lakh so it is also in the same proportion There is no additional employee cost. Of course we might be holding during this expansion period we will be having employees to the extent of 23 stores who will be under training. Those will be extra so that from the date the store is opened they will be able to take over and do their duties.
So there is no major inconsistency in the whole process. Only thing is the gestation period of the stores getting matured is a time in which we are there and we are hopeful that from the H2 of this year you will see all that efforts and investments get rectified in giving the results.
Keshav
So you did not touch upon the capex for FY26 FY27 the rental as a percentage of revenue what it is.
KVLN Sarma
I told you there is already out of IPO proceeds there are 200 crores available in the bank bank which we will be spending for expanding to the extent of 60,000 square feet that we are planning this year.
Keshav
So what about the rentals as a percentage of revenue?
KVLN Sarma
Rental as a percentage after this expansion rentals as a percentage of total turnover is approximately approximately 65 by 14 and 120 about 4%.
Keshav
Great sir, answer what is the percentage of advertisement and sale promotion that you intend to incur going forward?
Rachamadugu Balaji Bharadwaj
I think especially what we have done in the last quarter is I think advertisement wise. I think as sir has also mentioned we’ve additionally incorporated more than crores from previous year to last year. So in this particular year I think we will be more or less like about maybe 5% more than what we spent last year in absolute rupees in terms of percentage wise that will still be lesser than the overall percentage because the additional turnover this year is going to add so we can take more or less in the same lens of what we spent in the last year.
Keshav
So is it true that we can we are expecting 1750 around top line for FY26 answer with what operating profit margin excluding lease rentals at this point.
Rachamadugu Balaji Bharadwaj
Of time I think we probably are probably like 45 days in, I think what we are trying is about 15, 20% of top end addition will definitely be possible for us. But giving a commentary on the EBITDA levels and pat levels, exact number could be quite difficult at this point of time. Probably at the end of Q2 and the early of Q3 there will be a little bit more visibility and LB able to give you numbers and guidance with respect to the EBITDA levels. But on the whole what I would like to mention is because we are expanding with our premium format because last year expansion also has been through Varama Lakshmi format.
The overall, the profile and overall contribution of this particular format is better than the company averages as well as better than any other brand that we currently have. All these factors put into case will be able to give you a better EBITDA margins as well as pack margins. Majority of our expenditures, if you take this year has majorly been in terms of the additional advertisement costs that we have done plus a little bit on the employee cost. And as I said, I think employee cost also because of low productivity levels, because of the negative researches, it had some impact, all of that.
When it gets normalized, we will go back into normal ratios like how we had in the previous years.
Keshav
Okay, so I’ll rejoin the question queue. Thank you.
Rachamadugu Balaji Bharadwaj
Thank you. Keshav.
operator
The next question comes from the line of Resha Mehta from Green Edge Wealth Services. Please go ahead.
Resha Mehta
Yeah, thank you. So the first question is on the, you know, gross margins. So previously we’ve guided for, you know, that with all the efforts that we were taking in in terms of volume discounts from our vendors and premiumization, 42% was a gross margin that, you know, we could achieve and we are almost there. Right. So from 42%, what is the further scope for expansion? And my question is more from a slightly, let’s say a two year standpoint rather than the immediate next quarter.
Rachamadugu Balaji Bharadwaj
I think if you see you’re right on what we have done so far. So probably in a year or year and a half from now there is a possibility to expand additional 1 1.5% of gross margin by the end of the next 24 months. One thing that I wanted to mention is the gross margin though we make an effort in terms of prepayment to the vendors early, the impact on the gross margin will only be when the sale of the product happens. So that is a continuous process. It has been happening in the last couple of quarters and it will continue to happen in next couple of quarters as well.
And because we are adding Our varamahalakshmi format, rather than adding KLM format at a low margin yielding format, even that also will have an impact on both these aspects. Considered maybe 150 points should be a decent target for the next two years.
Resha Mehta
And again, the levers are the same, right? Premiumization and volume discounts from your vendors. Right. So these are essentially the two levers.
Rachamadugu Balaji Bharadwaj
That’s correct.
Resha Mehta
And you know, related question. So if we see your payable days, right. So they used to be around 60 days and now they are down to almost seven. Just seven days. Right. Single digits. So is there a scope to increase the number of payable days? I mean, can we delay payment to our vendors a little bit? Because even as per the norms, you. Know. We can get up to one month of credit. Or do you think that we are seeing healthy cash discounts because of, you know, the lower payable days and we’ll continue at these levels?
Rachamadugu Balaji Bharadwaj
Yeah, so it varies case to case. Wherever possible we try to work as delay as possible because any number of days adding to our payable days is actually in favor to us. But at this point of time, I think when we, when we sat down on this and when we did our modeling, we believed after the initial 2/4 quarters, the cash discounts is making a lot of sense to us rather than like you know, dealing the payable days. So case to case basis we are, whenever we are trying to approve, we are getting these cash discounts from our vendors and we continue to do so.
Though these days remain to be around 7%. This is not going to probably be a continuous phenomena. Probably we should be around 15 to 16 days in the, in the long run. But at this point of time this has been working for us and we will continue to extract and squeeze as much margin with this number of payable days. The specific thing for these two years is that then since the entire expansion is being done through IPO proceeds, there are generations in the company with which we are able to reduce the bank borrowings as well as prepayments reduced level of creditors. So by doing this we are getting a better negotiating ability with the Centigraders also. So once this expansion is complete, in fact we are expecting that we would be a debt free company both on the by the year 26. This year in itself we should be a debt free company because of the internal generations that we have which will be deploying in reduction of titas and the bank borrowings.
So this will add to a better reduced finance cost and all that at this point of time. So Once the total expansion is complete, then we might require at that point of time the centigrade level. But by that time we would have a better negotiation ability branded as a good paymaster with the in the market. So going ahead we will be able to maintain those discounts though we will be able to get some credit part. So currently this is a strategy for improvement of our margin profile vis a vistablishing ourselves with the vendors that we are doing.
And as and when we make a decision whether it is a profitable for maintaining credit or making cash discounts that we will on a continuous basis study and then take addition of that get it.
Resha Mehta
So basically safe to assume payable days to be in single digits or you know, very low number at least for the current financial year, which is FY 2526. My next question is on the inventory. So inventory, you know we ended the year with almost like over 180 days, right? Almost 194. 195 odd days. And by FY26 end the exit rate, I mean we are targeting around 160 days of inventory. So do you think with all the measures that we were taking, is that still a realistic number to target or would you want to kind of, you know, give another guidance for the inventory days by the end of FY26?
KVLN Sarma
Yeah, if you recall from the time we came to IPO where the inventory was 638 crores and then we have put up, we have put up approximately 1 lakh 10,000 square feet of varmax area. So in the normal course the basic inventory minimum inventory levels that we need to maintain would also should have been an addition of 200 crores. But on a continuous monitoring and optimizing our inventory levels we are reducing the inventory levels on a staggered basis from the year 23 to 25. You would see there is an optimization that has taken place in inventory levels.
We are relating to the turnovers. Once these stores get matured and gives higher productivities in many of the stores, we are expecting that the productivity should be improving by more than 40, 50%. So once we achieve those better productivities, you would see the proportion of inventory vis a vis the maintenance of inventory is fully optimized. We should be able to get to 150 days of inventory by the year 26 itself.
Resha Mehta
Okay. And lastly, you know, on the demand side, so if you could just quantify the number of wedding dates for the full financial year 2526 versus what was that number in 2425. And also, you know, the last 45 days of Q1, how are you seeing the demand kind of shaping up?
Rachamadugu Balaji Bharadwaj
So in terms of the overall wedding dates, I think compared to last year and this year there were marginally higher wedding dates. But, but as I did mention, the dates have been distributed. So if we take an example of quarter one last year versus quarter one of this year, quarter one of last year probably are having around close to 11 to 12 dates. But in this particular year, quarter one we have close to 24 to 25 days in this particular quarter. So that’s almost like 100% jump in the quarter. So in these 45 days of operation we have seen a double digit SSG grow, a good double digit SSG growth, but I think it’s just been 45 days.
We see some sort of a slowdown coming at the late of mid, mid to late of June. But on the overall send, I think we should still be at a double digit SSG growth in this particular quarter.
Resha Mehta
Right, right, right. All right. And would you say that, you know, with your Q4 performance of 11% revenue growth and you know, considering we had nine wedding dates which were well spread out from Jan to March, would you say that you would be satisfied with the 11% revenue growth that you achieved? Or do you think, you know, there were gaps in our execution or something of that sort, you know, where we could have probably done better?
Rachamadugu Balaji Bharadwaj
If you, if you probably look at quarter four, I think there definitely is a scope with respect to the operation side. There was possibility where we could have done better. There were two impact draggers which were pulling us down, which is especially for Varama Lakshmi silk format. We anticipated higher sales in ap. AP was a little bit dragger in for Varamahalakshmi and for klm. Telangana has been a dragger there. So barring these two other two states and other three states did perform well. It’s just that the lower SSG level recovery that we could have ideally anticipated it to be a little better.
If that would have happened, we’d be more happy. I mean, I mean honestly speaking, what all of this, all in all, constitution, probably another 20, 25 crore of additional turnover with our SSG stores last quarter should have been a decent quarter for us.
Resha Mehta
Got it. All right, that’s it for me. Thank you and all the best.
Rachamadugu Balaji Bharadwaj
Thank you.
operator
The next question comes from the line of Sarvesh Gupta from Maximal Capital. Please go ahead.
Sarvesh Gupta
So sir, hello.
Rachamadugu Balaji Bharadwaj
Yes sir, please go ahead with your question and please be a little loud. Thank you.
Sarvesh Gupta
Yeah, so the first question is on the Tax Just a clarity. So you said that now we have negotiated a deal with the income tax department for this 27 odd crores. So is it like a combination deal that the promoters 50 crores which has also a big liability is also sort of solved along with this or that is just an expectation that it will be solved?
KVLN Sarma
No, no. Let me clarify this company’s company’s income tax liability as and when the assessments are happening. We have agreed to certain, we have not agreed to certain kind of a thing. And then ultimately income tax department has agreed for some deletions of some additions and some like that and ultimately agreed. We have agreed that for a period of around six years we would accept an income tax liability to the extent of 14 crores which along with interest has become 27 crores. So it’s, it is every year assessments each year, each item wise we have discussed and where there was no major documentation available and all that we have agreed and they insisted on that.
So accordingly it’s not negotiated in the means. It is like we attended the assessments and agreed to some what they proposed and they agreed to a few deletions that we requested for. And this is the final figures that have come out of the assessment process for the total of seven years. On the promoters front, promoters have presented their case and then they have not agreed for the liability that has been put on them by the income tax department and they made an appeal that is independently. Both these assessments have taken place independently by the independent come by the company, companies officials, by the promoters.
They don’t chartered accountants, they are all independent like that.
Sarvesh Gupta
So as of now that 50 crore liability is an expectation that it can get resolved? Yes, they have already.
KVLN Sarma
They have already made an appeal and they are hoping that promoters are hoping that this can be resolved either at zero or a substantially lower figure.
Sarvesh Gupta
Okay, okay. And secondly sir, on the, on the overall Varama Lakshmi strategy, so now the question is, you know like we want to expand more but in if we look at our financials, if you look at our inventory days, the gross margin also sir, if we look at the advantage that we got from reduction in trade payables that itself is showing up as gross margin advantage. But I don’t think at a company level we can establish that increase of Vara Mahalakshmi share from 40 odd percent to 50% has sort of increased the gross margin at the company level.
Similarly our inventory days are higher and payable days are down. So I mean have we established that this Varama Lakshmi format expansion is proving to be fruitful to the company at an overall level. Because we are again expanding on this.
KVLN Sarma
At this point of time during the implementation process. Since these stores have not fully matured and they are not yielding the full productivities, you are finding the difference in the total turnovers vis a vis the financials. We are expecting this. The Varma Lakshmi format that has put in Tamil Nadu over the last one year, one and half year are getting matured during the current year and also whatever small and big effort on creating visibility that as we made, we have already made. So once the same stores, if they give higher productivities and then operate to the optimum capacity, you will find a difference, a substantial difference in the financials both on the turnovers as also on the profitability.
So we are in the gestation period at this point of time where the source have been established and we have not reached it to the optimum level of productivities. That is why the financials are looking a bit easy. But by the year in 26 we should see a substantial difference having got the full productivities on these stores.
Rachamadugu Balaji Bharadwaj
Quick point. If you look at the current levels of gross margin right from the IPO time it’s on account of both the things, right? So one is Varama Lakshmi stores getting added and two is a vendor level discounts that we are able to get on reduction of the payable days. This is basically a double edged effect that you’re seeing on the gross margin level that is going to continue along with whatever has been mentioned. It is not just the advantage. What we have got is not purely on account of just adding Vara Mahalakshmi stores are not just on account of making a payable deal better.
It’s a combined effect of both these things together.
Sarvesh Gupta
Okay, thank you and all the best.
Rachamadugu Balaji Bharadwaj
Thank you.
operator
The next question comes from the line of Harshit Khadka from Robocapital. Please go ahead.
Harshit Khadka
My question is already answered. Thank you.
operator
Thank you. The next question comes from the line of Niharika Karnani from Capgro Capital. Please go ahead.
Niharika Karnani
Good afternoon. So my first question is on the inventory aging. What is the current inventory aging as of FY25? And we have seen inventory increasing from 690 crores in FY23 to 778 crores in FY25. With inventory turnover ratio getting reduced. So is our inventory piling up and does that pose a risk to the company?
Rachamadugu Balaji Bharadwaj
Okay. 23 to 25. We have added more than 1 lakh square feet of the Varma Lakshmi area. As you are aware, the Varma Lakshmi minimum base quantities that we need to maintain in the stores itself is 20,000 rupees per square feet. So on a ratio proportion it should have been a little higher than that. But since we are optimizing on the inventory part also we were able to maintain it 770. Otherwise there should have been an accretion to the extent of 200 crores on the inventory. Secondly, the reference to our turnovers. Inventory turnover it is. The figure is looking low right now because the productivity is in the.
The stores have not been optimized. Once we reach optimized productivity levels, the inventories, I mean the inventory turnover would look much better than what it is appearing today.
Niharika Karnani
And what is the current inventory aging?
KVLN Sarma
I think we have approximately around 5% over two years.
Rachamadugu Balaji Bharadwaj
Yeah, I think the inventory above the age of one year is around 11.5% and about two years is around close to five and a half to 6%.
Niharika Karnani
Okay.
Rachamadugu Balaji Bharadwaj
See, I mean what I’d like to mention is these inventories though it’s a year or two years doesn’t really fade away. The value per se, the kind of fashion. And because it’s one size fits all, it generally doesn’t have such a sort of an impact. It still has quite a decent number of options for them to get sold out. I mean one of the major reasons why we are confident about this is with respect to the employee commissions and incentive structure that is basically wrapped around the inventory aging. All of these things put together I think should, should definitely not be a problem in the current situation where we stand.
And one other thing is I think as was also mentioned by CFO sir see from 25, from 23 to 25. I think the inventory optimization did happen especially from last year to this year only we have done an optimization close to 60 to 70 kind crore kind of a number. As we move and actually expand, I think this number should further get optimized. So I think there is definitely an improvement this year and there will definitely be an improvement next year as well.
Niharika Karnani
Understood. So just one more question here. So with the inventory aging numbers given by you, is there any risk of selling out those inventory? Say there is a fashion change or change in taste and preferences of people. So is there any risk of reaching the state of liquidation?
Rachamadugu Balaji Bharadwaj
No, I think that risk is negligible actually because as I did tell you this one size fits all and majority of the our products using our personalized commission and incentive structure that we have, there’s a beautiful system which is wrapped around the inventory aging and the incentive structure. So if you see the employees get paid based on the inventory aging, that’s there. So the moment they identify that there is a particular stock which is moving beyond six months or beyond nine months because the employees and staff get better incentive on selling these things, a lot of these things actually turn in our favor.
The best part is most of our products does not involve customer walking in and figuring out it themselves. That’s where the challenge happens. But unlike that, when the employees are required to showcase the products on the shelves, making to the customer and displaying it to them and explaining it to them, most of these risk factors get favored if you incentivize the salesman properly. I think lot of these inventory related issues is not going to be there at a company level. We are not at all worried about this particular fashion or style moving away. Anything, anything less than three years is something that we do not worry about at all.
Niharika Karnani
Got it, Got it. Thank you.
operator
Thank you. The next question comes from the line of Anuj Kashyap from A3 Capital. Please go ahead.
Anuj Kashyap
Hello, Good afternoon.
Rachamadugu Balaji Bharadwaj
Good afternoon. Yes, you’re audible.
Niharika Karnani
Last year we have announced our silver jewelry business. So why not there’s no mention in the investor presentation about the road that business.
Rachamadugu Balaji Bharadwaj
Yeah, sure. So with respect to the silver jewelry, I think the total aggregated retail square feet of our silver jewelry stores is around 10,000 square feet. On the overall, I think these are all small pop up stores that we used in terms of the service area. There was no additional retail square feet addition that we have made. All of this is actually provisioned within the service levels of our existing stores. And the total inventory value on this particular side is close to the MRP value is close to around 9 and a half to 10 crores of inventory is there.
I think what we have done is we have launched this in the first quarter of last year. I think though it did see a season only the actual season actually started at the Q3 levels. We have only completed two quarters of implementation at this point of time. We are not looking at expanding any new stores. We want to further wait for a proper season this year as well and then take it forward. It remains to be in the same stores. We are not planning to expand anything further. Now we actually out of the seven stores that we used to have in this, in.
In the stores, I think we removed one store already and there we currently have six stores. We’ll probably wait for quarter two of this year and look at how things are progressing and then take a decision.
Anuj Kashyap
On that yes, you’re right sir. I think the stores were in the Kalamandir space. What I have read memory served me right. But what I wanted to know is what was the customer response. So there was not no until addition to our books. So what was the customer response? Just I wanted to know whether the. Whether the products which were. Which were selling or whether they were like the demand from the customer side. Just I wanted to know about that.
Rachamadugu Balaji Bharadwaj
The nature is in that most of our stores Kalamandir is there and definitely few Varama Lakshmi stores also small pop up around 300, 200, 500 square feet is what we have. But the nature of the jewelry business, what we’ve understood is customers need a larger inventory for them to sit and choose from. With our existing store formats, with adjusting the space by not impacting the regular store operations which our entire core is based out of, we believe that we should either look at opening an exclusive store or probably start keep maintaining these levels only in terms of the number of options displayed to the store.
I think what customers generally expect is a larger number of variety of options for them to choose from. Because we are operating in existing store, we don’t have an opportunity to display a larger quantity of inventory for every customer walked in. So at this point of time it is not moving much in our favor. If this continues to be the case by the end of first half, then probably we might have to look at taking a decision of slowly start winding up and if things start progressing then we should be able to start managing and adjusting the inventory percent then probably look at expansion further down the line.
Anuj Kashyap
This is the last one for myself. So just. Sir, like what you’ve said in one of your answers that we wanted to increase our margins. So is there any strategy like that we are focusing on to go to going beyond the Indian borders? Like the Middle east market is quite lucrative and the Indian traditions, how they are catching up on the social media and all traditional rushes. So do you think that we will be able to. If we think about those markets, we’ll be able to catch the higher market.
Rachamadugu Balaji Bharadwaj
Got it. So with respect to the demand wise, I think we did get calls and there is quite an amount of research that we are trying to do Middle east. But at this point of time, since our geographical presence is only in terms of South India and even in South India also we are not present in probably Kerala and all of those markets, our immediate focus would be to expand into the Indian market before looking outside. See if you look at the current scope we are only present in 20 cities and probably we are doing around 1460 crores kind of last year number.
After this year, after adding the 65,000 square feet, I think with a 20% increase our city count would probably be less than 30 stores. I mean 30 cities. So there’s a lot of scope, lot of expansion for us just in this core market just inside the country itself. We believe that we have not even, not even, not even reached to at least 10 to 20% of the overall country’s potential. And we still at this point of time, at this kind of productivity levels we’re having once after completion of our expansion slowly from our core markets, little bit towards Maharashtra, Orissa and all these markets then that would be a right time for us to look out, look at expansion outside at this point of time, probably not.
With respect to gross margin. I think I already made this commentary before as well. I think the nature Varama Lakshmi Singh’s expansion as well as vendor discounts, both these things should be able to get us additional gross margin expansion of about 100 points in the next two years.
Anuj Kashyap
Yes sir. Just a quick, quick one. What is the age profile of our customers? If you have the track record. Just, just, just for the. Just for the idea purpose. What is the age profile of our customers?
Rachamadugu Balaji Bharadwaj
I’m sorry, I did not get your question. Are you asking about the range profile?
Anuj Kashyap
No, no. The age age profile.
Rachamadugu Balaji Bharadwaj
With respect to age profile I think the nature is that majority of our purchases are wedding based purchases. And these purchase generally happen in groups. Because it’s wedding, the majority of the age, I mean people who come are both the mother and daughter. Mother of course will be around 40 to 60 age group and the daughter will be around 20 to 30 age group. These purchases generally happen in groups and out of the entire saree purchase that we have, if you take example of Varama Lakshmi, 60% of Varama Lakshmi revenue is bridal based revenue and 40% is coming from your festivities.
So that’s how the ratio is between the wedding and the non wedding purchase for vm.
Anuj Kashyap
Thank you sir. Thank you sir. Best of luck for the future.
Rachamadugu Balaji Bharadwaj
Thank you very much.
operator
The next question comes from the line of Piyush Bangar from Vijit Global Securities. Please go ahead.
Piyush Bangar
Good afternoon everyone. First of all thank you for the opportunity. Question is how many stores were converted from Kalamandir to Kanchipuram Paramahalakshmi in FY25.
Rachamadugu Balaji Bharadwaj
So we opened only. We converted only one store of Kalamandir to Varamahalakshmi silks. We have a provision to convert another store in this financial probably, probably by Q2 we should be able to convert another Kalamanda to Varman XV stores. And that’s about it.
Piyush Bangar
Okay. Another thing is what is the expected timeline for the launch of the warehouses we plan in the IPO and how will these impact.
Rachamadugu Balaji Bharadwaj
So with respect to our warehouses, there were two aspects that we mentioned in the documents. I think we wanted to augment the current capabilities in Telangana. The second thing is in Tamil Nadu, with respect to Telangana, I think we want to wait for a few more quarters for us to open augment the capacity. We are trying to. We are in the process of bringing a just in time model and trying to reduce the overall inventory. So I believe that the current the warehouse which is about 1 lakh square feet out of which there’s a space that is currently not being used there.
So we wanted to use that space before augmenting that. So we don’t see an immediate requirement in Telangana at least this year. With respect to Tamil Nadu warehouse, I think we already did open a small warehouse distribution center in Salem which is about four and a half thousand square feet. And using that we are trying to work on a model where we can quickly dispatch to all of our Tamil Nadu stores. Apart from that, we also have a small warehouse in Kanchipuram. These two things are currently being serviced for our Tamil Nadu belt probably by the, by the, by the quarter three or quarter four of this year.
After adding probably two, three more stores in Tamil Nadu, we will look at a strategic locations and probably add a warehouse in Tamil Nadu by the end of this year.
Piyush Bangar
Okay, that’s, that’s great. Second thing, just when you said about the wedding basis in Q1, FY26, you said that earlier the same year, like on a Y O y basis in Q1, FY25 they were like 15 days, 15 wedding days. And this quarter we have something about 45 days. Please correct me if I am wrong.
Rachamadugu Balaji Bharadwaj
So I think last quarter what I did mention were about 12 to 13 days in the last quarter. But in this particular quarter we are having about 24, 25 days.
Piyush Bangar
So what about the full year compared to the FY25? What are the number of wedding days we can expect in FY26?
Rachamadugu Balaji Bharadwaj
So for the full year we should be around close to around 86 kind of days. I think quarter four dates are not out yet and probably we have to look at a better calculation. But compared to last year and this year there will be an additional of about 5 to 10% additional wedding dates, more or less. That’s it. But the main important thing is the wedding dates being distributed would have another equivalent impact as much as the number of wedding dates. So this year we see a healthy pipeline of these dates spread across the entire quarter and generally this particular quarter, quarter two, there is a slight slowdown, but quarter one, quarter three, quarter, quarter four are considered to be better quarters in this convention.
Piyush Bangar
And how many wedding days are there in FY25?
Rachamadugu Balaji Bharadwaj
FY20 I think close to 74, 75 kind of wedding dates are there. But in FY26 I think there’s around 5, 10, 84, 85 days.
Piyush Bangar
Okay, okay, that’s, that’s great. I just have few follow up questions from the earlier participants. As you said that we have 43% repeat customers or repeat sales, is that right?
Rachamadugu Balaji Bharadwaj
Correct?
Piyush Bangar
Yeah. So yeah, earlier here we have reported like 6.5 lakh customer customers out of which 53% revenue was from repeat customers. So why we are seeing this decline in repeat customers? If you could explain this.
Rachamadugu Balaji Bharadwaj
So one thing is in terms of it, when you add KLM stores, because KLM stores generally attract a larger number of customers and a larger number of bills, the number of customers who come into a KLM are far more. So when you keep adding Varmahalakshmi silk stores because the number of bills are lesser, the number of customers are less. Just that the bill value is high. So that’s the kind of impact on the overall repeat customer. But apart from that it is still in line. And last year also on account of maybe a lack of a few wedding dates and the market has not been great.
In the overall consumption side we have seen a slight decrease. But when you compare us like in the overall industry average side I think 43% repeat customer is quite which puts us probably in the top five or top six retailers who have a high repeat purchase. This year particularly we have gained about 18 lakh customers out of which around 8.3, 8.4 lakh kind of customers are repeat customers. And this is repeat customers in terms of number. But repeat customers contribution in terms of the overall overall revenue will more or be less in the same number that you have mentioned.
Piyush Bangar
Okay, just talking about e commerce and digital things. We have reported like daily website visits 18703 in Q4 Q3FY25 which has declined to 10603 in Q4FY25. But the average order value remains the same which is 4664. Why is it so.
Rachamadugu Balaji Bharadwaj
So when you look at e commerce, right? So Kalamandir, Varamahalakshmi and Mandir. There are three websites that we currently run our e commerce business. This year I think Mandir and Varamahalakshmi Silks took a major advantage in terms of the overall contribution. Kalamandir was one of our lower performing formats. So we had our entire emphasis on Mandarin brand Mandir and Varma Alakshi silks and that’s the impact on that. Majority of the revenue that share that we have gained back in e commerce business particularly came from these two formats and not the other format. Kalamandir typically has an ASP of around less than around 700, 800 versus Varamalakshmi Mandir.
The ASP is around 10,000, 11,000 rupees. So that’s, that’s the amount respect to the impact that we have. But overall I think e commerce as a business remains to not grow as aggressive as the offline expansion because of the nature of the business itself. But, but still we are happy to run the e commerce business because majority, I mean 100% of our E commerce revenue is coming directly from our website and we are not leveraging any marketplaces or anything else per se.
Piyush Bangar
Oh, okay, okay, that’s, that’s great. As you said that we are facing negative same store sales growth in the KLM format. Are we planning any. And as you said that we’ll work on supply chains, especially the men’s and kids for better optimization of the resources. Are we planning any new stores or you know, targeting new addressable market in the segment to make it like positive same store sales growth as well as improving the efficiencies.
Rachamadugu Balaji Bharadwaj
See, I think a lot of things with respect to KLM has happened. See last year I think we did put a good amount of efforts in terms of the marketing for KLM as well. But what we understood is that there were gaps in terms of the overall procurement, the sizing as well as the color charts. What we had in KLM was not fitting right and one of the major beatings happened with respect to men’s and fit. So with that we understood the message loud and clear and we are actually working on that. Probably by end of Q1 or probably by end of Q2 that corrections will happen until and unless we see a positive SSG growth for klm, we do not anticipate to add any KLM stores and definitely not in this year or the next year.
Piyush Bangar
And are we planning any new products or something like that.
Rachamadugu Balaji Bharadwaj
So with respect to klm, yes, I think we are putting more focus on planned purchases. We are trying to hire teams to help us optimize loan productivity, low productivity and low inventory products. Remove them and probably focus more on the other categories. One such category is womenswear as well. I think women’s wear we believe has a high potential and we wanted to focus and leverage more on that. So in terms of adding new categories, probably not within the existing categories, we would be probably making more changes.
Piyush Bangar
Thank you for the opportunity. I just had one suggestion to you. Please add the same store sales growth across all the formats in your investor presentation. So it will be helpful to just take a look on it.
Rachamadugu Balaji Bharadwaj
Sure. Thank you. I’ll do that. Yeah.
Piyush Bangar
Thank you for the opportunity.
operator
Thank you. Ladies and gentlemen, due to time constraints, that would be the last question for today. I would now like to hand the conference over to Mr. Bharadwaj Racham Dugu for the closing remarks.
Rachamadugu Balaji Bharadwaj
Thank you all for taking time to join and participate in this call Today. The current market seems to be quite in favor in terms of how the wedding rates are spent on the overall demand wise. We are also seeing consumption level demand coming back to us. These two levers generally have been factors or pointers that help the company to like, you know, grow further. So hoping to meet you all probably next quarter. Thank you all for taking time. Thank you. Bye.
operator
Thank you sir. Ladies and gentlemen, on behalf of Sai Silk Kalamandar Limited that concludes this conference. You may now disconnect your lines.