V2 Retail stock price has risen nearly six times over the past one year. V2 Retail is a leading fashion and lifestyle retail chain in India catering to the needs and preferences of fashion-conscious customers at affordable prices for over a decade. The company caters to men, women, and children, offering a variety of clothing, footwear, accessories, and lifestyle products. V2 Retail revenues rose 53% YoY to Rs 296 crore in Q4FY24 compared to Rs 193 crore in the same period previous year. Earnings before interest, tax, depreciation and amortization (EBITDA) for the quarter stood at Rs 31.4 crore in Q4FY24 compared to Rs 14.2 crores in Q4 FY23, a rise of 121% YoY. EBITDA margin stood at 10.6% for Q4 FY24 as compared to 7.4% for Q4 FY23.
Reborn in 2011, V2 Retail is a strong player in the value retail segment. Earlier known as Vishal Retail, the company was incorporated in 2001, but fast expansion led to debt accumulation of more than Rs 700 leading to corporate debt restructuring in 2009. Vishal Retail sold its wholesale and retail businesses to private equity firm TPG and Shriram Group respectively in 2011. Rising from the ashes, RC Agarwal owner of Vishal Retail started a new value retail business under his already listed company (Vishal Retail) in 2011. The company’s name was changed from Vishal Retail to V2 Retail in 2013. Covid pandemic halted V2 Retail’s expansion plans and later high cotton prices impacted volumes as product prices increased. Post pandemic, V2 Retail made a major comeback by shifting to in-house design and manufacturing which allowed greater control over its product portfolio. According to the management, in-house design and manufacturing enables the company to react swiftly to market trends and consumer preferences.
The company operates on the principle of ‘Value and Variety’ selling its merchandise at affordable prices to the neo middle class group of population living in Tier 2 and Tier 3 cities. V2 Retail’s business model revolves around making quality products accessible to the large section of society within acceptable price points. V2 Retail’s average selling price (ASP) was Rs 263 and average bill value was Rs 795 in Q4FY24 making it one of the most affordable fashionable retail chains in India. The company has per sq. ft sales per month of Rs 830 for Q4 FY24 and Rs 854 for FY24. Operating in the same arena as star performer Zudio, V2 Retail presence cannot be missed out with revenue growth of above 20% over the past five quarters.
While V2 Retail’s network is lower than the 545 store network of Zudio, it is way ahead of peers Style Up, Intune and Yousta. The company currently operates 117 stores spread across 17 states and around 100 cities with a total retail area of ~ 12.54 lac Sq. Ft.
Largely concentrated in the northern and eastern part of India, V2 Retail needs to spread its network across the country.
Speaking on expansion plans, RC Agarwal, Chairman and Managing Director at V2 Retail said, “Our expansion plan on stores is on track. We have added 15 stores (net) in FY24 and plan to open additional 20-25 stores in FY25.” V2 Retail stock price touched its new 52-week high today at Rs 740.
