Relaxo Footwears Q2 Revenue Grows 12%; Profit Nearly Flat

RELAXO reported a steady revenue performance in Q2 FY27, although profitability remained under pressure amid inflationary costs and softness in mass-market demand. The company’s revenue from operations increased 11.6% YoY to ₹701.6 crore, compared with ₹628.5 crore in the corresponding quarter last year. Net profit rose by a modest 2.8% to ₹37 crore, while EBITDA increased 5.2% to ₹85.3 crore. However, the EBITDA margin declined to 12.2% from 12.9% a year ago, highlighting the impact of raw material price volatility and higher labour costs. The company is focusing on cost management, product mix improvement and strengthening its distribution network. During the quarter, Relaxo added 16 Exclusive Brand Outlets (EBOs), taking its total store network to 445. Management remains on track to reach 500 EBOs by the end of FY27. The company is also investing in refreshed retail formats and brand-building initiatives to improve consumer reach. For H1 FY27, revenue grew 9.6% to ₹1,407 crore, while EBITDA increased 7.1% to ₹193 crore. Net profit for the first half stood at ₹92 crore. From a research perspective, investors should track recovery in mass-market demand, gross margin trends, premium product mix, retail expansion and the company’s ability to translate revenue growth into stronger profitability. Learning Takeaway: In consumer businesses, revenue growth alone may not indicate improving performance; investors should also examine margin trends, cost pressures, product mix and distribution expansion to assess earnings quality. Disclosure: This post is for educational purposes only and does not constitute investment advice. Any holdings or conflicts of interest should be disclosed separately.