Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Sai Silks (Kalamandir) Limited (NSE: KALAMANDIR) Q4 2026 Earnings Call dated May. 13, 2026
Corporate Participants:
Rachamadugu Balaji Bharadwaj — Senior Vice President
K.V.L.N. Sarma — Chief Financial Officer
Analysts:
Rahul Jain — Analyst
Unidentified Participant
Ankit Gupta — Analyst
Presentation:
Operator
Ladies and Gentlemen, good day and welcome to the Sai Salts Kalamandir Limited earnings call for quarter and year ended March 31, 2026. This conference call may contain 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. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. As a reminder, all participant lines will be in the lesson 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 touchtone phone. Please note that this conference is being recorded today. On the call we have with us Mr. Bharadwaj Raja Madugu, CEO and Mr. K.V. Ellen Sharma, CFO. I would now like to hand the conference over to Mr. Bharadwaj Racha Madugu, CEO of the company. Thank you and over to you sir.
Rachamadugu Balaji Bharadwaj — Senior Vice President
Thank you. Ikra Good morning everyone and thank you for joining us today for the quarter four and full year FY 2526 earnings conference call of SAIS Kalamangal Limited on behalf of the management team, I extend a warm welcome to all of our investors, analysts, shareholders, stakeholders who are joining on the call today. I hope all of you had an opportunity to review our financial results presentation and investor material shared with the stock exchanges and are available on our website as well.
Joining me today on a call is our Chief Financial Officer KVLN Sharma. FY26 has been an important and transformational year for Saisil’s Kalamanga Limited despite mixed discretionary demand environments and increased competitive industry intensity, we still delivered strong double digit revenue growth, significant profitability improvement, sustained margin expansion and also focused on our retail expansion. Before I move into our business performance, I would also like to briefly touch upon the broader industry environment and evolving consumption trends that are shaping the women’s ethnic Indian market.
The Indian ethnic wear and occasion led market continues to remain structurally strong which is supported by the wedding economy, the rising disposable income premiumization and also the shift towards the organized retail from unorganized. One of the biggest structural drivers continues to be the wedding ecosystem. India’s wedding led consumption remains highly resilient and wedding as well as the festive purchases continue to drive a significant portion of spending across retail categories. At the same time, organized retail also continue to gain market share across India.
Consumers are more aware today, increasingly are preferring brands and are trusting retailers due to the transparency that is available, better customer service, the omnichannel convenience and the larger group of retail store network that they have. We’re also seeing a strong growth coming from tier 2 and tier 3 cities where rising aspirations, infrastructure development and brand awareness is creating meaningful long term opportunities for organized ethnic retailers. From a region standpoint, South India continues to remain one of the strongest ethnic wear markets in the country, particularly in categories such as sarees and women’s ethnic wear which aligns well with our core positioning and brand strengths.
However, the industry is also witnessing heightened competitive intensity, faster fashion cycles, increasing digital influence which has an impact on the purchase behavior. Overall, we remain very optimistic about the medium and long term opportunity in the Indian ethnic retail market. The structural demand drivers for the category remain firmly intact and we believe organized players with strong brands, deep regional understanding and disciplined execution are well positioned to benefit from this opportunity over the coming years.
Coming to our operational performance, I will first discuss the quarter four performance followed by the full year 26 highlights during quarter four from a retail expansion perspective we added approximately 24,000 square feet of retail addition. During the quarter we delivered a revenue of about 419 crore representing a growth of 5.1% YoY despite a relatively mixed consumption environment across certain mature markets, our gross margin stood at 42.08 compared to 41.71 last year, an increase of 37 basis points.
Our PAT for the quarter stood at 32.65 crores compared to 13.51 crores last year, an increase of about 140% YoY coming to the full year FY26 performance FY26 again was a significant year in terms of expansion, operational strengthening and profitability. During the year we have added 13 new stores and one extension store taking our total network of our store from 68 stores to 81 stores across five states. We added close to 78,600 square feet of retail space with a net retail addition of about 69,000 taking our overall retail area to about 7.
85,000 square feet across five South Indian states. For the full year, our revenue grew by 13.1% to 16.54crore compared to 14.62crore last year, while the same store sales growth stood at plus 3%. Varamahalakshmi, silks and Valli formats led the growth majorly this year. For the full year FY26, our EBITDA grew by 128 basis points to 15.76% compared to 14.48% last year. Despite the changing market environment we continue to maintain healthy gross margins at 42.07 percentage reflecting an improvement of 30 basis points over last year.
Our PAT for the year grew significantly to 141 crores compared to 85 crores in the previous year representing a very strong growth of nearly 65% even after considering the one time tax impact in the previous year, our operational pack last year was around 105 crores. Against this 141crore pat that is achieved this year, a substantial improvement of about more than 30% of PAT improvement demonstrated a strong operational efficiencies, disciplined cost management and overall profitability across the business.
Additionally, few other metrics such as the ROE has improved from 7.78 percentage to 11.78 percentage which is while the ROCE improved from 13.7% to 16.7% reflecting stronger profitability and improved capital efficiency. Overall, FY26 was a year where we successfully balanced expansion, profitability, operational discipline and strategic investments for our future growth while continuing to strength While Looking ahead in 2027, one of the key priorities for us will be to be able to focus on walk ins across underperforming catchments.
We have identified potential stores where the trends have softened and targeted hyperlocal marketing initiatives along with localized digital and on ground campaigns. This will help us improve customer acquisition and engagement from a merchandising standpoint as well, we are undertaking detailed assortment correction initiatives to improve alignment between stock mix and as well as the consumer demand patterns. Thank you and I now wish to open the forum for 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 press star N1 on their touchstone telephone. If you wish to remove yourself from the question queue, you may press Star and two 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 Rahul Jain from Credence Wealth. Please go ahead.
Questions and Answers:
Rahul Jain
Thanks for the opportunity. Am I audible?
Operator
Yes, you are. Yes Mr.
Rachamadugu Balaji Bharadwaj
Rahul, you’re audible.
Rahul Jain
Yes. Yes. Thanks for the opportunity. Sir, a couple of questions my side. First of all so how do we look at growth for the next year in terms of net square foot addition and also SSG given? In the previous call we had mentioned that we have a strong wedding season right up to one more quarter. So somewhere this quarter also the wedding season good till now. Just to understand how do we look at the next square feet, addition and overall ssg. So whereby what kind of revenue growth we are looking for FY27.
That is my first question.
Rachamadugu Balaji Bharadwaj
See in terms of revenue addition, I think last year we have added close to 75,78,000, close to about 10% of retail addition is what we have added. And this year we tend to actually plan a little bit more aggressive store expansion. We have identified potential locations and the pipeline is more streamlined and solid this year. Therefore we should be able to expect at least 20% more than last year’s square addition easily. However, I think probably after H1 if there’s something else and additional stores might come up, I’ll keep you posted.
But please, for now we should be able to expect at least 20% more than last year’s square feet addition. Now with that in mind, I think. Yes, sorry,
Rahul Jain
No, sorry. This was net addition, right?
Rachamadugu Balaji Bharadwaj
Yeah. See generally we don’t our net addition and the overall addition is same. Just in this finance this quarter we have reduced the capacity. We did not close down any stores. We have reduced the capacity in one of our stores and therefore that negative 9,000 square feet is there. That’s the first time I’m actually talking about the net retail addition. Otherwise it’s always the same thing. We don’t have any store closures that we anticipate in this year. But again overall, to answer your question, in short, yes, the net square feet addition in this year will be in the range of 100,000.
On the SSSG front, the way we look at is we generally look at the wedding calendar. The wedding calendar is positioned comfortably this year. There could be a small shift between quarter but overall the number of reading dates wise seem to be healthy. This is again spread between 4/4 of Q1 and Q2, Q3, Q4. So we do anticipate a similar to a little bit better SSHG numbers than we’ve achieved this year. So that’s with respect to our SSSG front and to your third question on your revenue guidance. I don’t think with the proper stores that we are going to open it will be difficult for me to give you a revenue guidance right now because as I did tell you, we are aiming at 100,000 but there could be chances where we might end up opening a little bit more as well.
Now keeping that in mind, our revenue targets will not have a right number. If I can give you a number right now. But broadly if I have to give you, it should be more than the guidance that we have, more than what we achieved last year 25, 26
Rahul Jain
With regards to the productivity at existing Stores. So typically we were targeting because Tamil Nadu has all the Varamalakshmi stores and we understand Vara Malakshmi is one of the best formats in terms of the growth. So if we look at Tamil Nadu today, the average square feet for the entire year is roughly around 32,300. So how do we look at this number for the coming quarters? Because last two, three quarters it has somewhere been in the region of 95 to 98 crores.
Rachamadugu Balaji Bharadwaj
I mean, I mean see overall Tamil Nadu averages are slowly picking up. See the point here is tier 1, tier 2, tier 3, tier 4. Tamil Nadu is one state that have split between all four tiers of stores. It definitely will improve, but it will not be a significant improvement. I think Y o y you should be able to see about 5 to 10% kind of an improvement slowly. However, I think these mature stores, when they come into maturity levels, I think this will ignite the process a little bit sooner.
Rahul Jain
Okay, does that answer your question? And the last question, Gross margins we have done reasonably quite well. We have been able to maintain somewhere near 42% gross margins. Just this quarter your EBITDA margin spot of having 42% plus kind of gross margins. Our EBITDA margins have been around 15% only or it’s around 14.6 primarily due to the increase in employee cost and the other expenses. So within those two buckets, anything to read in terms of some kind of one offs for garage and going forward, do we look at a similar kind of quarterly run rate for these expenses?
Rachamadugu Balaji Bharadwaj
See on the gross margin side, I think I have to give you this year we have taken it as a very serious note. One of the top high priority KPIs for us is to maintain the gross margin irrespective of the fact we’re coming with the newer formats and lesser gross margin stores. We have done a lot of activity around the improvisation in terms of gross margins in terms of vendor discounts and therefore we were able to maintain the gross margins at this level despite all these changing economics. Right.
But when you talk about the EBITDA percentages in quarter four, there are broadly two heads where our expenditure hit the other expenditure majorly driven by advertisement cost. So advertisement cost, we have been reducing the advertisement cost and we have been split that between last year and this year. If you look at YoY, our advertisement cost reduced by almost like about 10 crore rupees. So this is a cost exercise that we have done and some of the expenditures fell into Q4. Secondly, one more thing is the employee cost I think on the employee cost side if you look at our store opening profile, majority of the stores Even in the 78,000 square feet almost close to 50% to 55% of our stores opened between December 15th and March 15th.
Therefore a significant employee cost added to this. That’s number one. And on the employee cost front also there are other factors such as this bonuses as well as the labor code impact. To a certain extent all of this is where the EBITDA actually took a beating in the quarter four. Otherwise we should be able to expect an EBITDA decent EBITDA of about the full year EBITDA plus at least 50 basis points in the next year.
K.V.L.N. Sarma
If I may add rahul here that Q3 and Q4 will have a slight increase in respect of personal cost on account of issue of a bonus in one area we will give in Q3 and one area we will give in Q4. Labor code commitment is a continuing process. So that will be there in the same length as it is today and Q1. Q2 we will not have that bonus thing bonus expenditure that will be there. So if we are working out any variation, variation to the extent of bonus will be lesser. Personal cost on account of bonus should be there in Q1 and Q2.
Rahul Jain
Sure. Thank you so much sir. Quite helpful and wish you all the best. Look forward to the 100k plus square foot edition going on.
Rachamadugu Balaji Bharadwaj
Thank you.
Operator
Thank you. Next question is from the line of Bala Muralakrishna from Oman Investment advisor. Please go ahead.
Unidentified Participant
Hi, good morning. First of all regarding this taxation issue recently you updated that income tax department. We heard of this taxation demand from the promoter that is about the 50 crores from. But when it comes to company taxation issue. So there is a 21 crores demand we immediately paid that. So why why would have not appealed that the company said how they agreed to lay off this 51 crore taxation from the promoter side. Would you please explain it?
K.V.L.N. Sarma
The contention on which they have raised a demand was wrong. I mean we cannot go into nitty gritty of what all happened. But they have taken a contention which was not tenable at that point of time. So we went for an appeal and during the appeal was allowed and finally the liability on the promoter came to around 50 lakhs plus or minus. And the other thing was it dropped because the contention of the original assessing officer itself was wrong.
Unidentified Participant
But why? Why we haven’t applied for this company tax.
K.V.L.N. Sarma
Company does companies aspect is in fact and I closed the chapter last year itself. So I having came to the I mean I have extensively explained about the company’s taxation where we have agreed because we have given advances to the employees during the COVID period and then we waved it off initially keeping them as advances. The income tax people have taken that it is to be re added back and then we have agreed for that. In respect of liability of the promoter is entirely a different issue involving some personal intercede transaction between the promoter group.
And then they have taken a wrong the contention and gave the demand on which the promoter group have gone in for an appeal and it was allowed. So both sides it was reasonably ended as of now and the matters are fully closed by
Rachamadugu Balaji Bharadwaj
Now. I think the company side. I think last year Q4 itself the matter ended and therefore the tax provisions have been made. That’s like Q4 of 2425.
Unidentified Participant
Yeah. The investor community is raising concern about how this 50 crore is negotiated and how the 20 crore is paid immediately. So that is the company. That’s why I have
Rachamadugu Balaji Bharadwaj
As I did mention the whole point was transactions between the promoter group and family members. I think. I think we did explain again but probably if at all you need a detailed explanation on this. I can probably give you separately. But broadly the condition the case here is there has been some transactions during the family trust creation from the promoter group site. So right now all the shares currently that you see from the promoter group majorly are parked under the family trust. During this entire transaction process there has been some assets that have been moved between the promoters and therefore the the income tax authorities have highlighted that and I have marked against a demand notice.
Now all of that we had a proper representation made to the government. I mean made to the department. And therefore they have waived it off and they’ve kept a nominal notice of about 25 to 50 lakh rupees. That is what supposed to be paid. That has been taken care of.
K.V.L.N. Sarma
Our continuation is accepted and the demand dropped.
Rachamadugu Balaji Bharadwaj
Yeah,
K.V.L.N. Sarma
There is no way. Is
Rachamadugu Balaji Bharadwaj
That clear?
Unidentified Participant
Yeah, yeah, fine. Fine. Secondly, on this slowdown in the growth rate in Q4. I mean small most flattish about Q3 and usually Q3 would be higher because of sector. But this time it’s not much like that. So is it the more Valley store sedation in the last two quarters is it that contributing for this slowdown because the ASP only is below and the other factor. Not necessarily. If you
Rachamadugu Balaji Bharadwaj
Look at. Yeah, so if you look at in terms of our revenue contribution between H1 and H2 we are still ideally it is like that between 45 to 55. In that range it moves. And if you look at this year number 2526 it moved between 51 and 49 which is. Which looks like as if having a decent growth that we had. Nothing particular with respect to Valisils. It’s just that the factors, the overall factors, which is geopolitical factors could be the consumption factors could be in the month of late January to February there has been some slowdowns in the overall consumption pattern and that’s what has caused us to this kind of a plus 5% otherwise.
One more reason why we had a little bit of less of a growth here is because our store addition again even in Q4 the two stores, the 25,000 square feet again came between March 10th and 15th. If at all we would have gotten a chance to open in maybe Jan. Or February, a significant revenue contribution would have been added overall. But it is just that the alignment of the store opening date happened to be at the late of the quarter for and therefore that particular store opening revenue didn’t actually contribute to the overall top line.
Unidentified Participant
Okay, understood. So regarding this new store opening, 85,000 or 90,000 square feet. So what could be the split between the formats? Could you see some rough number how many Varma Lashmi? How many Valley
Rachamadugu Balaji Bharadwaj
See at this point of time giving an exact number on the formats could be difficult. But again are the format that will lead the expansion for us. We still don’t plan to add any KLM stores. It’s just going to be varamahalakshmi Kalamandra and Vali stores that will lead the overall expansion that we anticipate in this financial year. I mean we hopefully plan to pivot into new state this financial year.
Operator
Thank you. Next question is from the line of Ankit Gupta from Bamboo Capital. Please go ahead.
Ankit Gupta
Thanks for the opportunity. Sir, can you give us the you know, format wise backup of sales for FY26 and 25 as well?
K.V.L.N. Sarma
Normally format wise sales are something that dissemination of the information is detrimental to the interests of the company. Broadly, broadly Varma Lakshmi did around 50%
Rachamadugu Balaji Bharadwaj
Of the 2%
K.V.L.N. Sarma
Of the overall thing. So the component of Varma Lakshmi is increasing in the overall pie. How much did you pay for
Ankit Gupta
VML? How much at percentage of sales?
K.V.L.N. Sarma
About 52%.
Ankit Gupta
Okay, okay, okay. And KLM if you can talk about like klm, how much decline have we seen in this financial year?
Rachamadugu Balaji Bharadwaj
So KLM I think the decline has been around low single digit around about 3% or so. With the overall decline for KLM format and the action plan we are, we are working on the action plan as well. And one of the store reductions that we have done from this net retail addition, I think 9,000 square feet of KLM reduction we have done to be able to like you know, have improved margin and improved profitability from that store. And these are the factors why KLM has shown a decline. Otherwise the plan for us this year again will be able to like you know, continuously change this product mix and still be to able able to achieve a positive SSG growth on KLM front.
Ankit Gupta
On the statewide sales. If you look at it, our two major states, Telangana, Andhra haven’t seen growth. In fact Telangana FY23 we did 600 crores of sales and FY26 we are at 500 crore. Andhra 443 and we are ending this year with 474. Of course there would have been an impact of KLM on this sales. But you know broadly these two states have been significantly underperforming for us. One of the states which was doing well for us because of the new additional stores was Tamil Nadu. But Tamil Nadu also in last two quarters we have started seeing a bit of flattening out as well as decline in sales in Q4 and we are saying Tamil Nadu we should not be expecting you know, more than 5, 10% of over growth for FY27 also without any store edition.
So you know, what are we doing to you know at least increase the scale the sales from Telangana Andhra. There is one thing on addition of net square feet but our SSSG has to increase significantly for us to improve our profitability as well as you know, see higher growth rates.
Rachamadugu Balaji Bharadwaj
See I do agree that you know Telangana has been a slower growth and this is majorly on account of klm. But all the other formats seem to add growth. I think even if you look at AP it grew by almost 15%, Karnataka grew by 27% and these growth is driven by majorly square feet additionally but on the SSSG’s fronts particularly I think because of the KLM format we have been seeing some dip because majority I think more than 60% of our 60, 65% of our stores of KLM is located in Telangana. So that’s the impact of that I think we are doing.
We have having plans on the KLM front to be able to revive that to still be able to deliver a positive SSGs. Apart from just the KLM front, all the other formats are continuing to deliver a positive growth both on the SSSG front as well as on the store retail edition front. The reason why you not Seeing a significant jump is all the new stores that are coming up are not based out of in Telangana majorly are getting added in outside of Telangana and those are the ones that are contributing to the the overall revenue.
So again in this year we did add like a few stores in APM Telangana and those stores have not had a full run of operations. And once they run probably they will also start adding. These are valley format stores.
Ankit Gupta
If you can give me, you know, for Telangana and Andra particularly, what would be the Varma Lakshmi SSH in this, in this states,
Rachamadugu Balaji Bharadwaj
This. I think it should be in the high single digit number.
Ankit Gupta
Okay. So at least VML continues to see decent SSHG in Telangana. Yeah, definitely.
Rachamadugu Balaji Bharadwaj
High single digit number overall is what is there. And I think similar trends will be in AP Telangana as well. Yes, right on that.
Ankit Gupta
Sure. And then on the new, you know, new new square feet addition of 100,000, of course you are saying, you know, we’ll be expanding in VML Valley and Kalamandir. But if you can give us, you know, where in which states will this expansion come? So and you know, which new state I think we had talked about entering Mumbai. And so if you can broadly give where will this new addition come and how will that have an impact on our margins given now we are entering the new states, there will be some higher advertising expenses, store opening expenses and other things which will come as we’re in, as we enter new states.
Rachamadugu Balaji Bharadwaj
So far with the stores that we have in pipeline, majority of our stores are coming in Karnataka and Kalamandir format in Karnataka is the one which is leading this expansion front. However, there is a new format that are going to come up which is Varah Mahalakshmi silks in Andhra and in Tamil Nadu as well. We have a few stores which are lined up with Varamalakshmi silks as well. So on the margin profile it will not have much of an impact. Okay. Varama Lakshmi and Kalamandir do have a little bit of a margin component profile difference.
But overall the still the goal for us is to be able to maintain similar margins without having an impact overall gross margin size. But I think there could be some more additions of the stores coming in which I could probably be able to comment probably at H1 ending to give you a little bit more clarity in terms of the newer square feet that comes up. But at this point of time it will be Kalamanda. The state that will lead the expansion is Karnataka. To your question of Maharashtra and other zones, yes, we are in advanced stages I think probably this year you should be able to see at least one store outside of our core markets.
Ankit Gupta
And so Last question on H1 Outlook for this year. If you look at last year, Q1 and Q2 were pretty heavy. You know, we saw some Q1 because of Q1, FY25 having a low base. We had a very good Q1 and Q2 also because of early Diwali and Dashera. This year we had a very good Q2. So given the highways of, you know, first half in this, in last financial year, how should we look at the growth for this financial year? Will we be able to grow at least 10, 15, 10, 12% or you know, will have higher sales in the second half compared to H1 as we had seen in last year.
Rachamadugu Balaji Bharadwaj
See, I think this year I think H2 should, should lead then H1. There are a couple of reasons why. The first is I think Dashara is now moved back to Q3 instead of Q2 and 2. There’s some in Q1, there’s some slow, slow edge in terms of the other commands that is going to kick in which is going to start in probably like about four or five days and last till mid June. But the point here is when you look at the wedding date calendar, right, I think the dates more or less are spread out. What I’m trying to say is like it still does have a evenly spread out calendar.
And keeping all of that in mind, whatever is maybe the slowest that we can see in probably one month here should probably be moved to Q2. This is the kind of movement that could happen. But overall the growth should be evenly spread out between H1 and H2. And this year I’m expecting that H2 should be better than H1
Ankit Gupta
In April. How much growth have we seen compared to last year?
Unidentified Participant
If you’re talking about April. April, I think April was about low single digit positive overall.
Ankit Gupta
Okay. Okay, thank you, thank you. Thank
Operator
You. Thank you. Next question is from the line of Nathan Jain from Fair Value Equity Advisory. Please go ahead.
Unidentified Participant
Yeah, thank you for the opportunity. So my first question is on the depreciation expense. It has gone down meaningfully this quarter. So are we looking at smaller formats lately or some asset light expansion? If you could clarify on that.
K.V.L.N. Sarma
The depreciation includes the, I mean 116 as 116 workings. So because some of the, some of the leases will expire, long term leases will expire and some new ones with a small store, small store format will come with an extended lease period. So it is mainly on account of the leases as 116 workings that it has come down slightly. Two of the major leases have expired and obviously when the lease period is extended, we have an extended lease period and then one lease period expires and the other kicks in the calculations.
Depending on the calculations there will be a change in that.
Unidentified Participant
Right. And how do we see it in FY27? Should it go back to normal or.
K.V.L.N. Sarma
It will be the same for this period and during, during the year we will be contracting for further stores. When I. When we contact for the further stores, the write of use of assets and thereby the depreciation thereon will be kicking in. In that.
Unidentified Participant
It’s not a owned. Go ahead, go ahead.
K.V.L.N. Sarma
No, no. It’s not a owned premises. No. So everything goes by the lease rate, lease rentals, lease periods and then the workings there on. So obviously when we are targeting 1 lakh square feet further during the year FY27, there is there should be an increase in the depreciation part.
Unidentified Participant
And regarding the margins, you mentioned that there was an impact of the bonus payout in Q3 and Q4. Would it be possible to quantify the impact? The bonus impact,
K.V.L.N. Sarma
It ranges, I think. Q4 we seem to have disbursed about 4, 4 crores bonus. We spread it over the year, some in Q3, some in Q4 and the impact during the quarter was to the extent of about 4 crores.
Unidentified Participant
So in terms of basis points, how much would it be? 60 crores.
Operator
Nitin, does that answer your question?
Unidentified Participant
No, I have a few more questions.
Ankit Gupta
Hello.
Unidentified Participant
Yeah. Yeah. So in terms of the wedding calendar, you mentioned that the dates are spread out evenly. But what about the absolute number of wedding dates throughout the year? Are they the same or is there any difference?
Rachamadugu Balaji Bharadwaj
Okay, so to answer your wedding dates calendar, I think that in terms of the absolute number we have around extra days than compared to last year. So yes, I think more than 5 to 10% of extra dates is what we have compared to last year.
Unidentified Participant
Great. And regarding the revenue outlook for FY27, you mentioned that it will be better than FY27. If you could clarify, like FY26, we have done 13% or so revenue growth. So should we be between 15 to 20% or 20 to 25%?
Rachamadugu Balaji Bharadwaj
The reason why I’m unable to give you a number is on the SSFG front we should be able to similar to a little bit better than last year which is more than 3%. On the revenue growth front, from the way we stand, it’s all coming down to the net, I mean total retail square feet addition that we are able to do at this point of time we seem to have a healthy square feet opening openings which is spread between Q1, Q2, Q3, Q4. Keeping that in mind is why I said that we will have a better number compared to the last year kind of a number.
But the reason why I’m not able to give you a number is because I should still plan for exactly how much square feet. And that’s why I said I’ll probably give you b able to give you this number at the end of H1 where I’ll have a visibility for the number of stores that I will be able to open till March. But overall
Unidentified Participant
We should
Rachamadugu Balaji Bharadwaj
Broadly, broadly if you look at, we should be able to do much better than this year’s 30 number something in the ranges that you mentioned.
Unidentified Participant
So gold has become more expensive like more so with the duty hike today. So. So as a result of that, should we see some part of the wedding budget that was earlier earmarked for jewelry now moving to apparel like sarees, etc.
Rachamadugu Balaji Bharadwaj
I think gold is directly and indirectly also in the same range. Right. Like you know our raw materials also do have gold pricing. I mean gold embedded into our products like in all the zari that we use in the products is all made from silver and gold. Again metal price do have an impact overall when this sort of a phenomena happens. And generally what happens is like the product ASP also start shooting up just in the last six months to seven months we have seen some increase in the overall pricing and that has caused the change in the consumer behaviors.
But if you look at that generally it should yield into positive trend because gold is becoming too expensive. The silver the alternative for gold right now are picking up with respect to such a silver jewelry and other similar categories. But again in terms of sarees also it’s the same thing. I think the budgets now have moved beyond like about which was about 1 lakh kind of a purchase today stands about like 60,000 or 70,000 on that front. So the bill values are also decreasing into that extent.
So. So yes, that’s that. On
K.V.L.N. Sarma
A lighter note, saris under these ethnic where has no foreign exchange involved. So we are expecting that some of the money that was discouraged to be spent on gold might come to apparel and particularly sariting season. So we are hopeful that we should have a better offtake by getting the money diverted.
Unidentified Participant
So just my last question, you mentioned that you would want to venture in at least one new state this year. So Would that lead to significant marketing expenses as you would like to establish your brand in a new state. Thank you. And that’s all from me.
Rachamadugu Balaji Bharadwaj
See yes it is possible but we still would we have budget on the advertisement sites to be still be able to run the 4% kind of a number only which is a similar number compared to this year. So we will reposition that whenever required. But yes, when we go to a new state it does require some noise to be made and we’ll definitely go all in when we go to a new state, get the local influencers or celebrities to be able to influence and be able to showcase that we are now present in that brand. Most of our store formats also when we open, I mean apart from certain formats like varamahalakshmi, most of the formats whenever we open stores we make a loud bang.
So not just during the opening, even post that also we do that for us to be able to get the eyeballs that we could get. And that’s something that we do for every store this year particularly on the advertisement and marketing front irrespective of the global I mean the BTL activity we started focusing on the ATL activities as well and focusing more on digital marketing and hyperlocal marketing campaign. That is something that we will continue to do next year as well in few of our weaker performing stores in terms of the walk ins.
But to answer question broadly the advertisement expenditure should be in the similar range compared in the same as how this year ended up in terms of percentage points,
Unidentified Participant
Right? Thank you and all the best.
Rachamadugu Balaji Bharadwaj
Thank you.
Operator
Thank you. Next question is from the line of Ankit Babil from Shipcom Ventures. Please go ahead.
Unidentified Participant
Good afternoon sir,
Rachamadugu Balaji Bharadwaj
How are you?
Unidentified Participant
I am fine sir. Sir, a couple of questions now considering the store edition plans you mentioned about adding 1 lakh square feet and a better SSG, you know compared to FY26. What kind of EBITDA margins we can look at in FY27
K.V.L.N. Sarma
EBITDA margins since the Varma alchemy component is continuously growing within the entire pipe and we should surely see this see an improvement in the EBITDA margin this year also because broadly I would say there is a potential of improving the to the extent of another 4,000 to 5,000 square feet in Varma Lakshmi format in Tamil Nadu. So mostly that will add to the benefit to the improvement in the margin profile as such. And also one other thing is of course that is not directly related but since the company is totally debt free and the company has enough resources for completing the entire expansion with the internal generations, there will not be any further borrowings and we expect that the company will not have borrowings for the next two, three years.
So all these, all these square feet additions and improved activities should improve on a total. Leave out the EBITDA margins. So ebitda margins is 1 point and subsequent to EBITDA there is no interest cost, no major interest costs will be there. So the difference between EBITDA margins and the pat margins would also shrink. Thereby the pat margins you will be able to see much better improvement than it was earlier.
Unidentified Participant
Okay. Because a few quarters back you had guided For a around 200 basis point EBITDA improvement every year. So we were targeting some 19% margins by FY27 at EBITDA level. So what are the new estimates? Where do you see? Because we have not seen much improvement in FY, you know, 26.
K.V.L.N. Sarma
The target would be the same. The target. I think this year we have reached about 16 point order and our target with the plan of action on Varma Lakshmi and I think we should be able to reach at least 18. We have already reached. Yes, 16 we have already reached. So it should be possible that we should at least be in the 17 and after 18 guarantee.
Unidentified Participant
17 and a half to 18 guaranteed. Okay. Okay. And sir, this wanted to understand that, you know, since you mentioned that you have enough financial resources to expand your retail network. So just wanted to understand why you are constrainting you to just one lakh square feet and not adding one and a half or more lakh square feet. Is it, Is there any execution challenge or you don’t see that that kind of a demand in the industry or you feel that the balance sheet doesn’t allow this.
K.V.L.N. Sarma
That is the target we have put in for the current year. But surely we will make an effort to improve the square footage. It’s not as though we try to locate a place and put up a store and do it. There is a lot of work, preliminary work that goes into locate a store. Currently we have a visibility of approximately 1 lakh square feet on which we have closed the entire process of for identification of the stores and then the other modalities of it. That is how Mr. Bhagwaj was mentioning that at the end of H1 towards the H2 we will be able to give.
Perhaps we should. We can give an indication that the store edition would be slightly better than this 1 lakh. Also it’s not about the resources but consider that we have never closed the stores on account of operational issues. So there is a Lot of work, preliminary work that goes on while locating the stores. And once that is located, obviously we will have enough resources to put up the stores and we should surely make an effort to go well beyond 1 lakh square feet this year.
Rachamadugu Balaji Bharadwaj
See adding to this, I would want to mention that it is always not about adding too much square feet. It’s also about retaining and maintaining the margin profile, maintaining the EBITDA profile, maintaining the profitability profile aspect of it. I think it is fair to say at this point of time that in our industry we command one of the highest gross margins. I mean again talking about a saree retailer here we are commanding a highest EBITDA margins and pat margins. The challenge is not opening retail stores and be able to like you know, be okay with reduced margins.
The challenge is to be able to identify carefully, hand pick carefully and be able to handhold these stores majorly. I think we have seen many in the cases in the market that too aggressive expansion also can cause consolidation of stores. Our goal is not about like opening the stores for the sake of like you know, just because there is a healthy funds in the cash system and then be able to look at a system where we had to consolidate the stores. I think the careful approach that we have been taking and slowly start incrementing this process and continuously delivering that growth year over year is our prime focus.
I think during our older conversations also I think I mentioned the same thing. While we do have the balance sheet support to open more, I think here it all comes down to the strategy piece where it is all about being able to maintain the similar kind of productivity levels, efficiencies while still focusing on the growth. So when you try to balance this, I think it has to go with the balanced approach and neither one can take precedence and one cannot take. So that’s the approach over. But overall if you look at yoy, we are continuously improving the retail square feet addition.
Unidentified Participant
Okay, so some mathematically since even if I take a 15% kind of a top line growth for next year, I mean this FY27 and you did mention about 17 and a half percent EBITDA plus no increase, no increase in interest cost. So at least a 200 basis point improvement in net margins. So this gives me a pat of around 200 crores for FY27. So are you guys also targeting that level?
K.V.L.N. Sarma
We will discuss this. I mean may is too premature to discuss the finer aspects of this but surely we will make an effort to improve our turnover vis a vis profitable discontinuously. But the Specific mathematics will discuss in the Q2 call.
Unidentified Participant
No problem. And someone last question is where do you see your inventory days in FY27 and your debt levels? We have seen slight improvement in inventory days. Yeah, even
K.V.L.N. Sarma
In this, even in this year you would have seen despite adding 70,000 square feet the increase in inventory was only 34 crores. So that there is a concerted effort constant vigil on that and to improve the inventory days. But if you are following us you would have remembered that I think second half of 23 year 23 or 24 FY24 when we put a KPI on the inventory part there was a huge reduction in the turnover during that quarter. So we are broadly balancing between the inventory optimization and the sales achievement and accordingly we will be taking a call on.
But surely there is an effort to continuously improve the inventory turnover.
Unidentified Participant
Any target sir, for this year how much improvement? Because 180 days was the last year’s inventory days which is still too high. So any targets here?
K.V.L.N. Sarma
It’s. It’s a continuous thing. See. But if I can, if I convey KPA on this within the system then it is taking a negative toll on the inventory part. Sorry the sales part. So we will make an effort to continuously improve if I have to broadly give you an indication
Ankit Gupta
From
K.V.L.N. Sarma
The year, from the year FY24 to this date. If you see the. See our balance sheet we have improved. We have reduced the inventory per square feet by around thousand rupees. What was around 1100 and 11,533 has come down to 10,480 or so. So that’s a concerted effort. But we have to make a get an equilibrium between the inventory days and the sale achievements that we that we will continuously monitor.
Rachamadugu Balaji Bharadwaj
On the overall other side to this is I think the format that we open. I think Kalamandir has a different inventory requirement. KLM has a different. I mean Varma Lakshmi has a different inventory requirement. And the store opening dates also does have an impact right at the end of the year. I think again talking about the inventory piece Again coming to this decision after H1 could be a better way to look at it.
Unidentified Participant
No problem sir. Okay. Otherwise thank you so much.
Rachamadugu Balaji Bharadwaj
Thank you.
Operator
Thank you. Next question is from the line of Nilesh Doshi from Prospero Tree amc. Please go ahead.
Unidentified Participant
Thanks for the opportunity sir. Many questions were asked by the earlier analyst. So my question connection to the earlier analyst that how the future expansion and the maintenance of the margin. So within how many days the new. Once the new store is open, we match the EBITDA margin of the matured store and within how many days they achieve the break even what revenue they will achieve
K.V.L.N. Sarma
Depending on the format, Varma Lakshmi format will give a payback within eight to nine months. Whereas to reach the EBITDA margins to get the store matured it will be approximately one and a half years to two years. The maturity part we consider is that we leave out the year in which the store was established and we leave one or one more year for the store to see the three cycles of a wedding dates and other things and then go on to the base figure. So obviously for the stores to store to mature and get established to the average EBITDA margins of the company it will be anywhere between one and a half years to two years.
And in respect of formats like Kalamandir etc, it will be slightly higher.
Unidentified Participant
Okay sir. And sir, we are operating the different format stores and but our blended GP margin is around 40 plus per percentage and EBITDA is around 12 to 13%. So which format is gay generating the higher GP and higher EBITDA compared to the other format? And are we expanding in particularly in that format or we are expanding the all formats
K.V.L.N. Sarma
They are location based. Tamil Nadu Varma Lakshmi format is the best format which gives higher gross margins and higher EBITDA margins. Whereas we have seen Kalamandir format has a good brand value in Karnataka, particularly Bangalore and other places. So when we have expanded in Tamil Nadu we expanded on Varama Lakshmi format. Now that we are expanding in Karnataka, particularly Bangalore with the Kalamandir format. So each format will have a different metrics depending on the location where its brand value is there.
Currently Kalamandir see we have reached some kind of a reasonable size in Tamil Nadu where the stores are in the process of maturity and improving the productivity. Now we see a potential in Karnataka, particularly Bangalore where the Kalamandir format is in good brand of brand has a brand equity. So obviously current expansion will include Kalamandir format and also on a need based Varma Lakshmi format. Broadly I think it should be about 40 to 60PML. We should here we should implement approximately in the range of 60 Bhatti between Kalamandir and Varama Lakshmi formats.
Unidentified Participant
Okay. And so ultimately all format are generating the near to equal margin EBITDA margin or it generates the differentiate between the one format to another
K.V.L.N. Sarma
Format will definitely give better EBITDA margins. But it cannot be put everywhere, it cannot be unlimitedly expanded. So wherever there is a potential for that we will be placing Varma Lakshmi format and the other places. Though Kalamandir format in Bangalore might give a lesser EBITDA margin but it has a potential to give higher turnovers. And by volume we will be able to achieve the absolute number of absolute amount of the EBITDA there. So we make a decision between. We make an analysis of these two between the volumes and the margins are there and then we take a call on that.
So that’s how this year Kalamandir in Bangalore also is a focus area along with Varma Lakshmi in general.
Unidentified Participant
Okay. And sir, my last question is related to inventory. How do you identify the slow moving item? Particularly there are many number n number of sarees kept in the store so there must be some slow moving items. So how do you clear that inventory and how do you value the inventory at the end of the year?
K.V.L.N. Sarma
Inventory valuation is the same principle. It is the cost or market value whichever is lower. So valuation part it is very much predefined. And with regard to the saree we have one advantage is that it fits all sizes. It fits everyone. And then size is not a constraint. And then it can be sold depending on the product like cotton saree or a silk saree or a Jajat etc. The shelf life is much longer there.
Unidentified Participant
So
K.V.L.N. Sarma
That is unlikely. We have many number of stores and then we keep moving this stock from one place to other depending on the suggestions that comes from out of our AI and mission tool. Suggestions we have an elaborate packages built in within the company where they will be continuously monitoring and the data analytics give which area which place the these kind of sarees are getting sold. And accordingly we move the product. So there will not be any issue on that. With regard to the aging of the sarees and keeping the sarees marketable above the cost price only if it comes to below the cost price only we need to be providing anything for that.
And in respect of sarees we also have the provision of converting them into half sarees or baby frogs etc. And since we have other formats like Kalamandir and KLM where these products can be put, we will be putting these things there. And then we ensure that each product is fully sold in whatever form and then the expected margin out of those product is realized.
Unidentified Participant
Thank you. Thank you. That’s all from the my side. Thank you sir.
K.V.L.N. Sarma
Thank you.
Operator
Thank you. Ladies and gentlemen, we will take that as the last question for today. I now have the conference back to Mr. Bharadwaj Raja Madhuku for closing comments. Over to you, sir.
Rachamadugu Balaji Bharadwaj
Thank you, sir. Thank you again for joining today. I think we had a good year, 25, 26. And we look forward to having a healthy year 26, 27. And looking forward to connecting you back at our Q1 results. Thank you everybody for taking time and joining today. Thank you so much. Thank you.
Operator
Thank you very much on behalf of Saisil Kalamindir Ltd. That concludes this conference. Thank you all for joining us today. And you may now disconnect your lines.