Raymond Lifestyle Q2 Results: Profit falls 10% as higher raw material, freight costs squeeze margins

Surging input and freight costs squeezed operating profitability even as double-digit revenue expansion was propelled by robust momentum in branded apparel and international garmenting orders. The firm transitioned from net debt to a net-cash position, supported by strong cash generation. How will management sustain margin recovery during the upcoming festive season?

Raymond Lifestyle Ltd reported a 10.19% year-on-year decline in net profit to ₹68 crore for the second quarter, compared with ₹75 crore in the year-ago period, on Wednesday (October 28). Revenue grew 13.2% year-on-year to ₹2,075 crore from ₹1,832 crore.

Earnings before interest, tax, depreciation and amortisation (EBITDA) declined 2.6% to ₹220 crore from ₹226 crore a year earlier. The EBITDA margin contracted to 10.61% from 12.33% in the corresponding quarter last year.

Raymond Lifestyle reported a 14% year-on-year increase in total income to ₹2,125 crore in the second quarter of fiscal year 2027, compared with ₹1,865 crore in the year-ago period.

The growth was driven by premiumisation and casualisation across businesses, higher volumes in Branded Apparel and a recovery in international demand for the Garmenting segment across key US, UK and European markets.

For the half-year ended September 30, 2026, total income increased 10% to ₹3,685 crore, while EBITDA grew 6% to ₹404 crore. The EBITDA margin for the first half stood at 11%.

The Branded Textile segment reported revenue of ₹971 crore in the second quarter, up 7% from ₹906 crore a year earlier, driven by festive channel uptake and premiumisation. EBITDA increased to ₹188 crore from ₹186 crore, while the EBITDA margin narrowed to 19.3% from 20.6%, amid higher raw material and freight costs.

Branded Apparel recorded its highest-ever quarterly revenue at ₹559 crore, up 20% year-on-year from ₹465 crore. Casualwear brands ColorPlus and Parx led growth. EBITDA rose to ₹49 crore from ₹41 crore, while the EBITDA margin remained at 8.8%, with adverse channel mix and higher raw material prices offset by the closure of non-performing stores.

The Garmenting segment recorded a 26% year-on-year increase in revenue to ₹339 crore from ₹269 crore. Growth was supported by order book execution following US-India tariff rationalisation, the UK-India free trade agreement (FTA) and the onboarding of new global clients. EBITDA rose to ₹25 crore from ₹14 crore, while the margin expanded to 7.4% from 5.3%, an improvement of 207 basis points.

Revenue in the High Value Cotton Shirting segment grew 5% year-on-year to ₹222 crore from ₹212 crore. EBITDA declined to ₹21 crore from ₹25 crore, while the margin narrowed to 9.5% from 12%, primarily due to higher raw material prices, partly offset by higher average selling prices (ASPs).

The Emerging Business segment, comprising Ethnix by Raymond, Raymond Home, Park Avenue Innerwear, Chairman's Collections and Sexual Wellness, reported revenue of ₹100 crore, up 15% year-on-year from ₹87 crore.

Raymond Lifestyle had 1,634 stores at the end of the September quarter, compared with 1,663 stores as of September 30, 2025. The company said it continued to optimise its retail footprint by reallocating resources to higher-efficiency formats while allowing newer stores to mature.

The company reported a net-cash position of ₹69 crore in September 2026, compared with net debt of ₹246 crore in September 2025. It said this represented cash generation of more than ₹300 crore.

Satyaki Ghosh, wholetime Director and CEO of Raymond Lifestyle Ltd, said, "Our performance in Q2 and H1 FY27 demonstrates sustained operational continuity, strategic resilience, and focused commercial execution across domestic and international markets.

Our Garmenting business continued to deliver robust growth, capitalising on global supply chain realignments, while our Branded Apparel business expanded by 20%, spearheaded by strong momentum across our casual brands ColorPlus and Parx.

While elevated input costs and channel mix dynamics influenced near-term operating margins, our disciplined pricing, substantial working capital contraction, and a net debt-free balance sheet with ₹69 crore in net cash provide tremendous operational resilience.

As we enter the peak festive and wedding season, domestic demand indicators remain strong. Supported by retail network optimisation, brand investments, and capacity ramp-ups, we remain firmly confident in our strategic direction and on track to achieve our stated FY27 guidance."

Shares of Raymond Lifestyle Ltd ended at ₹499.80, down by ₹0.95, or 0.19%, on the BSE.