26 August 2022, Mumbai
Homegrown retail footwear brand Khadim India expects gross margins to improve by 100-150 basis points by the end of this fiscal, backed by the company’s drive towards premiumization of offerings and cost rationalization measures.
For the quarter ended June 30, 2022, the company’s overall gross margin stood at 41.3 percent, a Y-o-Y increase of 596 bps while retail gross margins improved from 50.6 percent to 54.1 percent.
The company hopes to touch the pre-COVID level sales in volume terms by the end of the current financial year. In value terms, it is at par with the pre-pandemic levels, she said.
In the wake of the change in GST rates on footwear and the increasing prices of raw materials, Khadim had taken some price hikes. Nearly 80 percent of the company’s products are priced below Rs1,000 where the GST has been increased to 12 percent from the previous slab of 5 percent.
The company also expects turnover to increase by around 33 percent to Rs800 crore by the end of the current fiscal from Rs600 crore during FY22
Khadim India also plans to add 70-80 stores every year across the country. A majority of these would be on the franchisee model as the company plans to follow an asset-light approach. Currently, 220 of its total 800 stores are company-owned while the rest are franchisees.
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