For Q3FY21, volumes were at 13.15 lakh units vs. 13.45 lakh units in Q3FY20. Higher discounting, unfavourable channel mix (e-commerce) led to average realisations declining 5% YoY to | 816/piece. Jeans continues to be an integral category with revenue contributing 45% of overall sales. Over the years KKCL has gradually diversified its product portfolio from jeans towards other categories (share of jeans down from ~70% in Q1FY17). During the quarter, casual shirts segment outperformed other categories, with positive sales growth and share in overall sales increasing 200 bps YoY...

With minimal social gatherings and people preferring to work from home, discretionary spending on categories such as jeans and shirts were significantly hit during the quarter. While the company has over the years gradually diversified its product portfolio from jeans towards other categories (share of jeans down from ~70% in Q1FY17 to 60% currently), still majority of revenues are derived from the jeans category. We expect the near term pain to sustain and the recovery to be elongated given the challenging scenario. We note that in the previous quarter (Q4FY20),...

For FY20, revenue growth was at 5% YoY to | 530.0 crore. The revenue growth for 9MFY20 was ~ 9% while revenue decline in Q4FY20 impacted the FY20 performance. Revenue growth was mainly driven by 5% volume growth to 53.2 lakh pieces with average realisation remaining flat at | 995 per piece. Prior to the Covid-19 impact in Q4FY20, the management had highlighted that the underlying market was weak, primarily on account of de-stocking at the distributor level owing to liquidity concerns. The advent of Covid-19 further exacerbated market condition due to store closures...

KKCL reported healthy revenue growth of 13.6% YoY to | 126.2 crore despite a challenging market scenario in Q3FY20. The growth was mainly supported by volumes (up 16% YoY to 13.45 lakh pieces). Rejig in product mix (higher sales of tops compared to jeans) and spike in sales from nontraditional channel translated into a decline in realisations by 2.4% YoY to | 1008/piece. Growth was visible across all channels with multi brand outlets (MBOs) (39% of sales) and exclusive stores (15.8%) reporting growth of 10.3% and 25.4%, respectively. In recent times, KKCL has enhanced its focus on higher revenue growth. However, the same has weighed on its...

Revenue grew by 9.5% y-o-y, as volumes and realisations each rose ~4% and the core brand Killer clocked strong sales growth. However, gross margins plunged by 473 bps owing to a rise in cost of goods sold, higher discounts and trade margins. The management expects gross margins to stabilise in the coming quarters. Consumer demand is yet to recover, while primary sales (from company to trade-channels/retail partners) are affected by liquidity crisis. Hence, KKCL is expected to end FY2020 with high single-digit revenue growth. The company is organising trade fairs,...

grew by 11% y-o-y to Rs. 133.1 crore from Rs. 120 crore in Q4FY2019 (in-line with our estimates) led by a growth of 10.5% in the quantity of apparel sales. On the other hand, realization was flat at Rs. 910 per unit. The apparel sales quantity was at 13.8 lakh units as against 12.5 lakh units in Q4FY2018. Gross margins improved by 593 BPS because of a considerable reduction...

KKCL reported steady revenue growth of 10.9% YoY to YoY to | 133.1 crore. The topline growth was mainly derived through volume growth of 10.5% YoY to 13.8 lakh pieces. EBITDA margins declined by 120 bps YoY to 20.7% Higher cash discounts and rebates to dealers led to significant spike in selling & distribution expense (up 140% YoY to | 14.8 crore). However, enhanced bargaining power with fabric vendors (owing to higher volume commitments by NCS) resulted in lower input price. This translated into...

We met the management of Kewal Kiran Clothing to gain an insight into the company's business outlook. Kewal Kiran is one of India's leading branded apparel companies with popular home-grown brands like Killer, Integriti', Lawman' and Easies'. Though KKCL has a strong brand portfolio, revenue growth has remained sluggish over FY17-9MFY19 owing to the onslaught of discounting by e-commerce players. KKCL has shied away from discounting its brands, leading to slower revenue growth. However, the management is looking to revive revenue growth by introducing lower priced products as...

ICICI Securities Ltd | Retail Equity Research KKCL reported healthy revenue growth 17.7% YoY to | 111.1 crore (I-direct estimate: | 107.0 crore). The topline was mainly driven by volume growth of 21.8% YoY to 11.6 lakh pieces. The strong volume offtake was largely attributed to higher discounts provided in the...

KKCL reported topline de-growth of 9.1% YoY to | 152.3 crore (Idirect estimate: | 160.3 crore) with volumes declining 8.6% to 15.2 lakh pieces and flattish realisation growth at | 1000/ piece. KKCL has always refrained from giving heavy discounts. This, in turn, has impacted its volume offtake. Furthermore, sustained competition from e-commerce players (aggressive discounting) has severely impacted the revenue growth of the company Gross margins for the quarter (including manufacturing expense) improved 540 bps YoY to 54.1%. The significant margin expansion...

ICICI Securities Ltd | Retail Equity Research KKCL reported topline growth of 35% YoY to | 106 crore, albeit on a low base (revenues in Q1FY18 had declined 25% YoY). Higher sales were mainly driven by volume growth of 35% to 10.2 lakh pieces while realisation per garment remained flattish at | 1035 Gross margins for the quarter (including manufacturing expense) improved 410 bps YoY to 51%. Given the fixed cost nature of the business, strong volume growth for the quarter resulted in positive...

ICICI Securities Ltd | Retail Equity Research Revenues for the quarter declined marginally by 1.1% YoY to | 120.0 crore against our estimate of | 134.7 crore. The decline was mainly owing to a 3.1% drop in blended realisations to | 960/piece. Volumes for the quarter grew marginally by 2% YoY to 12.5 lakh pieces Tepid volume growth resulted in negative operating leverage, as employee, manufacturing and selling expenses as a percentage to sales increased 250 bps, 190 bps and 100 bps YoY, respectively....

a decline of 3.3% in its reported revenue to Rs. 120 crore. This was mainly due to a decline in realisation by ~2% y-o-y, though sales volume increased by ~2%. Gross margin for the quarter increased by 132 BPS y-o-y to 55.9% as cotton prices declined during Q4FY2018. However, due to higher employee expenses (up by ~22% y-o-y) and selling and administrative expenses...

Kewal Kiran Clothing Ltd is engaged in manufacturing and marketing of wearing apparels. The company's segments include Apparel & Life style Accessories/Products, and Other/Reconciling Item. The company is also engaged in generating power from wind turbine generator. It offers a range of western wear for men and women under its four brands: Killer, Easies, LawmanPg3 and Integriti....

ICICI Securities Ltd | Retail Equity Research Kewal Kiran Clothing's (KKCL) Q3FY18 performance was below our expectations on all parameters with revenue, EBITDA margin and net profit lower than our expectations Q3FY18 revenues remained flattish at | 94.4 crore against our estimate of | 108.9 crore. Volume growth remained flattish with 1%...

ICICI Securities Ltd | Retail Equity Research Kewal Kiran Clothing (KKCL) reported a strong set of numbers wherein revenue and profitability were above our estimates Revenues rose 12.4% YoY to | 167.5 crore against our estimate of | 162.9 crore. Higher sales were mainly driven by volume growth of...

ICICI Securities Ltd | Retail Equity Research Revenues for the quarter were mainly impacted by de-stocking of inventory at the dealer's level prior to GST. Revenues de-grew 24.9% YoY to | 78.4 crore vs. our estimate of | 110.7 crore. Volume degrew 25.9% YoY to 7.6 lakh pieces while average realisations remained flattish YoY to | 1038 per piece. Apparel sales value declined 27.4% YoY to | 73.5 crore while apparel realisation per unit was down 2% YoY to | 974 per unit EBITDA margins declined 940 bps YoY to 9.3% mainly on account of...

ICICI Securities Ltd | Retail Equity Research Kewal Kiran Clothing's (KKCL) Q4FY17 revenues were marginally below our estimates. However, EBITDA and EBITDA margin were above our estimates. Higher other income on account of profit on redemption of fixed maturity plan bloated the overall net profit KKCL reported subdued revenue growth of 2.9% YoY to | 130.3 crore vs. I-direct estimate of | 136.5 crore. Total sales volume declined 4.7% YoY to 12.3 lakh pieces while blended realisations...

ICICI Securities Ltd | Retail Equity Research Kewal Kiran Clothing (KKCL) reported a subdued set of Q3FY17 numbers wherein revenues were in line with our estimates. Revenues for the quarter were impacted by demonetisation as it...