Relaxo Footwears Q4: Profit Slips Despite Stable Revenue, Cost Pressures Remain

Image Source: India Infoline

Relaxo Footwears Ltd., the country's premier footwear maker, announced its results for the March 2025 quarter, witnessing a slight slide in profitability underpinned by consistent revenues and continued margin tensions.

Key Highlights:

Revenue Performance: The firm reported revenue from operations of ₹6.95 billion in the March quarter, demonstrating resilience amid a tough consumer backdrop. The number is almost in line with the prior quarters, indicating stable demand for Relaxo's diversified product portfolio.
Profit Decline: Net profit for Q4 was ₹562.2 million, a year-on-year decline. The company blamed the decline on increased raw material prices, heightened competition from unorganized players, and below-par consumer demand, mainly in the eastern region.
Expense Management: Total quarter expenses stood at ₹6.7 billion, down slightly from last year, but operating margins were under pressure as a result of high input costs and price aggression by domestic players.
Market Dynamics: The footwear industry has been confronted by soft retail footfalls and increasing competition, resulting in losing market share for branded participants such as Relaxo. The company is emphasizing enhancing direct-to-consumer channels and anticipating demand to increase in the coming wedding and festival seasons.
Outlook: Management is cautiously optimistic, anticipating a steady recovery in volume growth and margins as consumer sentiment picks up and raw material prices stabilize.

Relaxo's Q4 performance reflects the continued woes in India's footwear industry, but the company's strong brand and distribution network make it well placed for a possible rebound.

Sources: Moneycontrol, Business Standard, IDBI Capital, Capital Market