Baazar Style Retail Ltd Q2 FY25 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Management growth scorecard
Revenue
Category 2
Margin
Category 3
Fundraise
No
Order
N/A
Capex
Yes
1 of 4 growth signals are positive — mixed outlook.
Full analysisRevenue guidance
Category 2- Revenue growth guidance for FY25 is 25%.
- Store additions expected to be 45-50 in FY25, up from initial guidance of 35, leading to ~33-35% retail area expansion.
- Same-store sales growth (L2L) for FY25 is guided at 9-10%.
- Strong growth momentum seen in H1 FY25 with total income up 41% YoY and private label sales growing 79% YoY.
- Second half of FY25 expected to have higher profitability and strong sales momentum, benefiting from front-loaded expenses in H1.
- Private label share increased to 49% in H1 FY25, supporting sales growth.
- Long-term CAGR growth expectation of 25% is maintained for FY26 and beyond.
- Sales growth driven by deeper market penetration, new cluster formations, regional marketing, and increasing brand visibility.
See what Baazar Style Retail Ltd management said on margin guidance — free account, 30 seconds.
Fundraise plans
No- Baazar Style Retail Limited plans to fund store expansion primarily through internal accruals; no new equity fundraising is indicated.
- Capex per store is around INR1 crore plus INR1 crore for inventory; total capex for 50 stores estimated at INR45-50 crores.
- Current borrowing is INR39 crores with cash and bank balances of INR17 crores.
- The company aims to repay debt completely and become debt-free, leveraging insurance claims and operational cash flows.
- No explicit mention of raising new debt or equity in the near future; focus remains on utilizing internal funds for growth.
- Management plans minimal loan utilization going forward and expects insurance claim settlement within the financial year to aid debt repayment.
See what Baazar Style Retail Ltd management said on order book — free account, 30 seconds.
Capex plans
Yes- Capex per store is approximately INR 1 crore for store setup, with an additional INR 1 crore for inventory, totaling about INR 2 crores per store.
- For FY25, Baazar Style plans to open 45 to 50 stores, translating to a capex of INR 45-50 crores.
- Inventory investment for new stores is similarly INR 45-50 crores.
- Entire funding for store expansion capex will be covered through internal accruals.
- Management expects PAT plus depreciation to be sufficient to cover capex investment.
- In FY24, capex was higher due to purchases of 3 new stores and investment in a new warehouse.
- The company has no current plans for new borrowings for expansion; existing borrowings (INR 39 crores) will be repaid using cash and expected insurance claims.
- The insurance claim expected this financial year will aid in becoming debt-free.
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Margin guidance
Category 3- Revenue growth guidance for FY25 is 25%, with aspirations to grow at a CAGR of 25% in the future.
- EBITDA margin expected to reach 14-15% sustainably; current trailing 12 months EBITDA margin is about 14.5%.
- PAT margin guidance for FY25 is 2.5% to 3% post IND AS, with a long-term target of 4% to 5% in the next two years.
- Profitability is expected to improve significantly in the second half of FY25, with Q3 onwards showing higher profitability.
- The company plans aggressive store expansion (50-60 stores annually), which may initially increase costs but is expected to support growth.
- EBITDA per mature store is expected to grow from 5% in year 1 to 15% by year 3.
- EPS growth is aligned with revenue and profit growth targets, though specific EPS guidance was not provided.
Order book
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