Sai Silks (Kalamandir) Profit Soars 14x in Q1FY26 to ₹30.06 Cr; Board Declares ₹1 Dividend Amidst Strong Growth

Mumbai, 25 July 2025: Sai Silks (Kalamandir) Ltd (NSE: KALAMANDIR | BSE: 543989) delivered a striking performance in the first quarter of FY26, reporting a net profit of ₹30.06 crore, a 1,338.3% jump from ₹2.09 crore in Q1FY25. The Board has declared a ₹1 final dividend per equity share, with 22 August 2025 set as the record date. The company also confirmed its 17th Annual General Meeting will be conducted on 29 August 2025 via video conferencing.

Stock Holds Firm as Investors Weigh Profit Surge and Dividend Announcement

Sai Silks’ share price held steady in Friday’s session following the Q1 earnings announcement. It closed marginally lower at ₹181.80, down ₹0.13 (0.071%) at 3:30 PM IST on 25 July 2025, after touching a day high of ₹191.69 and a low of ₹171.56. The muted stock response may reflect profit booking after the stock approached its 52-week high of ₹197.00. Its market capitalisation stands at approximately ₹2.74K crore.

Profit Jumps Over 14x: Strong Revenue Growth and Operational Discipline Drive Surge

In Q1FY26, Sai Silks posted total income of ₹384.71 crore, significantly up from ₹274.03 crore in Q1FY25. The rise was driven by a 41.8% year-on-year growth in revenue from operations, which stood at ₹379.02 crore this quarter compared to ₹267.29 crore a year earlier.

The company maintained tight cost control, with total expenses at ₹344.47 crore, up modestly from ₹271.23 crore in Q1FY25. Major expenses included ₹269.85 crore for purchases of stock-in-trade and ₹53.21 crore for employee benefits. Operating leverage contributed to a steep rise in profit before tax, which stood at ₹40.24 crore, against ₹2.81 crore last year.

After accounting for ₹10.18 crore in current tax and a ₹0.70 crore deferred tax benefit, net profit surged to ₹30.06 crore from ₹2.09 crore a year earlier. The company also reported total comprehensive income of ₹30.39 crore versus ₹2.14 crore in the same quarter last year.

EPS Soars as Profitability Expands; Dividend Reflects Confidence in Cash Flows

The company’s earnings per share (EPS) rose to ₹2.04 in Q1FY26 from ₹0.14 in Q1FY25, reflecting substantial earnings momentum. The Board’s decision to declare a ₹1 final dividend per share (on a face value of ₹2) indicates management’s confidence in consistent profitability. The record date for the dividend is 22 August 2025.

IPO Proceeds Being Steadily Deployed; ₹174.10 Cr Yet to Be Used

Of the ₹1,201 crore raised via IPO in September 2023, Sai Silks has utilised ₹392.14 crore as of 30 June 2025. The funds have primarily supported expansion and operational enhancement:

• For 30 new stores, ₹71.08 crore has been spent out of the allocated ₹125.08 crore.
• Only ₹1.96 crore has been used for 2 new warehouses, leaving ₹23.44 crore unutilized.
• Working capital saw a major allocation, with ₹186.20 crore used out of ₹280.07 crore.
• Loan repayments worth ₹50 crore have been completed.
• For general corporate purposes, ₹82.90 crore of ₹85.69 crore has been utilised.

This leaves a balance of ₹174.10 crore to be deployed in coming quarters.

Board Moves to Strengthen Governance and Capital Structure

The company confirmed it remains debt-free on working capital borrowings, signalling financial prudence. It plans to repay ₹16 crore of short-term loans, further reducing the interest burden. Additionally, the Board has proposed the appointment of M/s P. S. Rao & Associates as Secretarial Auditor for a term of five years, aligning with its long-term compliance and governance strategy.

Kalamandir’s Business Model Fuels Profitable Growth and Expanding Margins

Sai Silks (Kalamandir) Limited is among India’s leading ethnic wear retailers, operating well-known brands like Kalamandir, Mandir, VaraMahalakshmi, and KLM Fashion Mall. The company leverages regional strengths and aspirational shopping trends in the ethnic wear segment to sustain its high growth and margin profile.

Key Financial Metrics: Market Strength Evident Despite Below-Median Growth in Some Areas

Sai Silks (Kalamandir) shows a market capitalisation of ₹2,839.6 crore, placing it among the higher valued firms in the ethnic retail sector. While its price-to-earnings ratio (PE) stands at 25, slightly below the industry median, its PEG ratio is 0.8, suggesting valuation is justified by earnings growth. Its price-to-book ratio of 2.6 is also conservative relative to sector leaders.

Revenue growth YoY for the quarter is a robust 41.8%, outpacing peers, although TTM revenue growth remains at 17.8%, slightly below the industry average. Operating efficiency is reflected in an operating profit margin (OPM) of 15.1% this quarter and a TTM OPM of 15.9%, both above industry levels. The Piotroski Score of 7 signals strong fundamentals. However, institutional holdings declined by 3.09% to 15.82%, possibly indicating caution among larger investors. Return metrics remain solid, with ROE at 7.5% and ROA at 5.2%, both above industry median.

Sai Silks continues to exhibit financial strength and operational clarity as it builds on its IPO momentum. With expanding margins, strong brand portfolio, and prudent capital deployment, the company remains positioned for long-term growth in India’s thriving ethnic wear market.

REF:https://nsearchives.nseindia.com/corporate/SSKL_25072025132242_Results.pdf

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