PDS Limited has informed the Exchange about Transcript
PDSL · price
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PDS Limited reported Q1 FY26 revenue of ₹2,999 crores, up 14% year-on-year, with Gross Merchandise Value of ₹4,634 crores (19% growth) and order book of ₹5,200 crores (8% growth). Gross margins declined 139 basis points to 19.4% due to the loss of high-margin customers like Gerry Weber and Matalan, and pricing pressure from US retailers navigating tariffs. EBITDA stood at ₹51 crores (1.7% margin) and PAT at ₹20 crores (0.7% margin), with the lower PAT also impacted by a higher effective tax rate jumping to ~25% from 13% due to global minimum tax (Pillar 2) in Hong Kong and UAE. Working capital days improved sharply from 17 to 10, gross debt reduced by ₹252 crores, and the company deployed BCG-led cost optimization targeting ₹25 crores in opex savings plus ₹30 crores in COGS savings in H2 FY26. Management maintained mid-teens revenue growth guidance for FY26 despite near-term margin pressure, citing favourable US tariff rates for its key sourcing countries (Bangladesh, Vietnam at 20%) and 7-8 of the top 10 US clothing retailers now onboarded.
Near-term stock sentiment may be cautious due to compressed margins, lower PAT, and global minimum tax headwind. However, the strong revenue growth, improving working capital, debt reduction, strategic tariff positioning, and clear H2 margin recovery roadmap with quantified cost savings provide a constructive medium-term outlook for shareholders.