SAI SILKS (KALAMANDIR) LIMITED

Recommendation history

• Q4 2026HoldHold: FY26 was strong on profitability but the growth read-through is mixed. Revenue rose 13.1% to INR1,654 crore, PAT increased 65% to INR141 crore, and EBITDA margin reached 15.76%, but Q4 revenue growth slowed to 5.1% and same-store sales growth was only 3%; FY27 revenue guidance remains unquantified despite a planned 100,000 sq. ft. expansion and a 17.5%-18% EBITDA-margin target. The bull case is disciplined, debt-free expansion led by higher-margin Varamahalakshmi stores; the bear case is weak Telangana/KLM performance, high inventory days, and execution risk in new markets.
• Q3 2026HoldHold: 9M FY26 was strong on reported numbers—revenue rose 16.1% to INR1,234 crore and PAT rose 50% to INR108 crore, with Q3 gross margin expanding to 42.2%—but the underlying growth read is less convincing. Management lowered FY26 revenue-growth expectations to 15% from the prior 18%-20% range, while analysts highlighted only 6%-7% growth across Q2-Q3 and no clear company-level SSSG; the aggressive FY27 expansion case therefore remains unproven despite 17%-18% EBITDA-margin ambitions.
• Q2 2025BuyBuy: Sai Silks delivered a strong Q2, with revenue up 28% to ₹444 crore, EBITDA margin improving 26 bps to 16.21%, PAT rising to ₹40 crore from ₹23.75 crore, and same-store sales growth of 17.5%. H1 revenue grew 34% and EBITDA margin expanded to 15.68% from 12%, while management raised its FY26 framework to 18%-20% revenue growth, implying roughly ₹1,750 crore of annual revenue. The key tension is that the faster-growing Valli format has temporarily lower margins and its steady-state economics remain unproven.
• Q1 2025HoldHold: Q1 FY26 was strong, with revenue of INR379 crore (+42% YoY), EBITDA of INR57.1 crore, PAT of INR30 crore and 29% mature-store SSG, but the comparison benefited heavily from last year’s wedding-calendar washout. Management’s normalized framework is only 15% revenue growth, 4%-5% SSG and 15%-20% near-term turnover growth, while inventory remains elevated and KLM still needs a sustained revival.
• Q4 2024HoldHold: Sai Silks exited FY25 with revenue of INR1,462 crore (+6.5%), Q4 revenue of INR399 crore (+11%), and gross margin expansion to 41.8% from 40.6%, but full-year SSG remained -5% and Q4 SSG was -1.5%. Management is targeting 15%-20% FY26 revenue growth on a better wedding calendar and 65,000-68,000 sq. ft. of mostly Varamahalakshmi expansion, yet the recovery is not proven, KLM remains around -10% SSG, inventory is elevated, and promoter tax exposure remains unresolved.
• Q3 2025HoldHold: Q3 recovered sharply, with revenue up 17.5% to INR448.6 crore, gross margin up 190 bps to 41.8%, EBITDA margin up 235 bps to 17.59%, and PAT up 43%. However, 9M same-store sales remained down 6%, KLM was still down 1% in Q3, and the recovery depends heavily on wedding-season demand and continued Varamahalakshmi expansion rather than broad-based store momentum.
• Q2 2024HoldHold: Q2 revenue rose 6.25% to ₹347 crore, gross margin improved 51 bps to 42.17%, but PAT grew only 1.7% and H1 same-store growth remained -6.5% after Q1’s -20%. Management expects a strong H2 based on 16 additional wedding dates and positive October trends, but provided no FY25 revenue or EBITDA guidance; the recovery is therefore not yet proven.