Indocount Q1 results had topline growth of 27% and EBITDA margins of 16% with reduced PAT margins.

Management guided for strong volume growth with EBITDA margin of 16-18% and focus on building D2C brands.

Q1 FY25 SUMMARY:

Volume growth of 26% to 25.3 Mn Mtrs in Q1and FY25 guidance of 110-115 Mn Mtrs.

Margins were impacted by 1.2% due to higher expenses related to logistics and brand building.

Investing in the supply chain , secured cotton till October and inventory levels have gone up.

Market sentiments are improving with enquiries from customers of key countries.

China+1 and FTA of India with other countries are crucial for the sector.

Continue to focus on target acquisitions and licensing agreements in future.

Have sufficient capacity for future growth and land to double the capacity.

7 verticals in the company with focus on doubling the revenue in 3 years

Branded business:

Completed acquisition of US brand WAMSUTTA for 85 Cr.
Major revenue contribution from WAMSUTTA will come from FY26.
It will be marketed in departmental stores of North america and later to other countries

Recently secured licenced brands WAVERLY and FIELDCREST promotions are going on and revenue to start contributing from Q4.

Existing JASPER CONRAN and GAIAM are doing well in UK &US.

Domestic brands like Boutique living and Layers are well accepted in India.

Target to reach 100mn$ sales through the D2C brand in 3 years.

Margins in D2C segment is 20-25%

Tax expense has decreased significantly QoQ on a almost flat revenue. Any idea why?

Well thought out, Sir, I would think that we may see much better gains in 2026 with Chennai firmly on board. The adventure park they have planned in Blr may also be good for footfalls. We hope so at least.

Disclosure: Invested

Please verify for yourselves the below by listening to the concall. If you do see a mistake below, please do let us know here so all of us can benefit.

My notes are not very good, but here goes:
Hyderabad did ok, but not the other 2 parks. This is because of elections, a lack of promotions in Bangalore due to the fact it could have been in bad taste during the heavy impact of water shortages in Bangalore.

The Orissa park is going well, they expect the ARPU to come down once the excitment dies down, but think footfall will hold.

Chennai has been delayed to perhaps Dec 25 or perhaps Jan ’26.

They will be going for some kind of funding for the next 7 years, so the promoters are truly devoting their life to this venture, quite reassuring to the investor I think.

However I thought there was a concern on why footfalls fell this badly (-25% Bangalore) and I’m not sure if they know why it is. I worry about the same given we have come short 3 (?) quarters in a row for one reason or another. OPMs are great but I fear a weaker future for now. May be the business is taking a breather.

Wish all here good luck.

In government tenders, estimated tender value usually doesn’t represent the final cost of the project. One guess is the EMD amount is a percent of this and hence you keep it low.