Arvind Fashions Limited (AFL) announced its Q2 FY27 results, marking its highest ever quarterly revenue and EBITDA. The company achieved a 10% top-line growth, with adjusted growth at 15%, driven by strong performance across channels and increased marketing investments. Profitability saw a significant boost with a 67 basis points EBITDA expansion. The company highlighted robust growth in its direct-to-consumer (D2C) segment and provided a positive outlook for the remainder of the fiscal year, focusing on profitable growth and strategic investments.
Arvind Fashions Reports Strong Q2 FY27 Performance
Arvind Fashions Limited (AFL) has announced its financial results for the second quarter ended September 30, 2026, showcasing its strongest performance to date with the highest ever quarterly revenue and EBITDA. This achievement was realized despite geopolitical uncertainties and inflationary pressures, underscoring the company’s resilient business model and strategic execution.
Key Financial Highlights
- Revenue Growth: The company reported a 10% year-on-year growth in Q2 revenue, reaching INR 1,559 crores. Adjusted for festive and online tower event shifts, the growth was approximately 15%.
- Profitability Improvement: AFL achieved a significant 67 basis points EBITDA expansion, driven by a better channel mix, strong like-for-like growth, and reduced discounting. EBITDA, excluding other income, stood at INR 216 crores, a 15.5% increase year-on-year.
- PAT Growth: Profit After Tax (PAT) grew by approximately 30% compared to the same quarter last year, reaching INR 48 crores.
- Gross Margin Expansion: Gross margin increased by 136 basis points year-on-year, supported by strong like-for-like growth, lower discounting, and an improved channel mix.
Channel and Brand Performance
The Direct-to-Consumer (D2C) segment continues to be a key growth driver, now accounting for 53% of sales, up nearly 380 basis points year-on-year. Retail grew by 15.4% with a like-for-like growth of 7.3% (10% adjusted for festive calendar shift), and 24 EBOs were added. Online B2C saw a significant 28% growth, increasing its share to 13% of sales.
Among brands, USPA delivered strong performance with high revenue growth and profitability. PVH brands are showing recovery and gaining momentum. Arrow and Flying Machine are in a transition year with a focus on structural efficiency and setting the brands up for future success.
Outlook and Strategy
Looking ahead to the second half of FY27, AFL expects Pujo and Diwali sales to track well, with near high double-digit like-for-like growth. The company remains watchful of macro-economic factors like inflation and geopolitical developments, planning proactive steps through smart pricing and cost control. Key focus areas include accelerating profitable growth, deepening consumer engagement, increasing the share of direct channels, and driving business efficiency.
Capital expenditure in H1 FY27 was approximately INR 100 crores, primarily for a new shirt manufacturing factory and a new corporate office. The company plans to continue investing in its D2C journey, aiming for a 65% share, and building digital capabilities. Investments in data, analytics, and AI are crucial for driving cost efficiencies and front-end effectiveness.
Arvind Fashions Limited expressed confidence in sustaining mid double-digit growth for the balance of the year, with an expected EBITDA margin expansion of 30 to 40 basis points.
Source: BSE
