Arvind Fashions posts strong growth in Q2 FY26

Arvind Fashions (AFL) reported a strong performance for Q2 FY26 as the company achieved an 11.3 per cent Y-o-Y in consolidated revenue, reaching Rs 1,418 crore.  This growth was primarily due to AFL's deliberate focus on direct channels, highlighted by an 8.3 per cent increase in like-for-like (LTL) sales across its retail stores and a massive over 50 per cent rise in its online business.

The financial health of the company got a further boost from an impressive margin growth. The company’s gross margin improved by 210 basis points (bps) to 52.5 per ent, a gain attributed mainly to a favorable channel mix that prioritized direct sales and a disciplined reduction in markdowns and consumer discounting.

This operating efficiency meant that Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) rose 18.2 per cent to Rs 200 crore, pushing the EBITDA margin up 80 bps to 14.1 per cent. Ultimately, this strength translated directly into profitability, with consolidated Profit After Tax (PAT) climbing nearly 27 per cent to Rs 38 crore.

The company’s management maintains an optimistic outlook, citing sustained momentum in their top brands, including US Polo Assn and Tommy Hilfiger. They also point to continued physical expansion with the addition of 24 new EBOs and a positive boost from recent GST reforms on consumer demand and spending.