Actually MGMT has provided exact data for men and women and how much earlier they starts the shoping for Wedding -
Men’s buys 10-15 days in advance
Women’s buys 30 - 40 days in advance.
And one more info is - Post Navratri their sales starts to increase and their sales peaks around a week after Diwali.
Vedant Fashion Limited
Vedant Fashion is a fashion brand catering to mid-premium to premium segment customers. In its Annual report and in DRHP , they claim to be the premium brand which indeed they are.
They never sold their products ever on Discounts and they claim to have the tight inventory model with auto replenishment with demand predictions. Their margins are industry leading . And when they were on IPO , their own DRHP said that they will expand their Carpet Area from 1.5 mn sq. ft. to 2.2 mn sq. ft. in the upcoming year.
All these things gave Vedant Fashion a premium valuation & a PE of > 90x & a P/B value of 31x.
Clearly investors are taking it as a bet for becoming the next Jockey ( Page Industries ). And by looking at the supreme margins it looks like a serious contender to Page Industries.
The have Industry Leading Margins
Manyavar derive majority of its sale from wedding purchase so their margins fluctuate a lot like a seasonal business depending on wedding dates each Quarter. If you find Q1 & Q2 sales declined then generally it is due to low to negligible numbers of wedding dates. While Q3 & Q4 are the quarters which analysts expect more sales growth because this is the quarter for Navratri , Diwali, Weddings. And particularly Indians prefer more weddings in Winters. So a single date of Dec - Jan - Feb period has multiple weddings as compared to that of Apr - May - June.
Peers -
On Demand level Comparison , Titan & Kalyan are also Peer, Cause both these players also rely on Wedding industry.
When it comes to business models they are not peers to Manyavar due to different Business Models.
On a Peer Comparison basis none of its peers are actually as comparable to Manyavar due to their own reasons.
1. Aditya Birla Fashion & Retail Ltd - have ethnic wear collection doing sales of 770 Cr but majority of these are acquired brands leading to tonnes of Goodwill with very thin margins and they derive 10% of total sales from Ethnic Wear ( 770 Cr ) while rest 90% comes from Lifestyle brands & Style ups
2. Sai Silks (Kalamandir) Ltd - It is a pure Ethnic player like manyavar but does not look very Premium ( my view ) in comparison with Manyavar. And it operates solely in South India. Manyavar is expanding its presence in AP & Telangana so on a regional comparison it is good .
3. Aditya Birla Lifestyle Brands Ltd / Arvind Fashions Ltd / Page Industries / Raymonds - Companies like these target essential segments / daily wear segment.
In this segment - average cost of Product is usually less than 3000 and their ASP is also low.
Product life cycle is max 2 years.
And we cant compare it with Manyavar cause their ASP is around > 10,000.
( As someone said in the above post )
Over Promising and Under delivering
Bad Things I found -
1. The Business Model -
Manyavar record sales when they ship their products to Franchise partners ( They call it primary Sales ) and this increases the receivables of the company to 160 - 180 Days. So when you read the Investor Presentation you will find Revenue from Operations ( Primary revenue ) showing Company’s sales of that quarter & also Retail sales ( Secondary sales ) which shows how much growth was there when the franchise partner sold those products to end customers .
While I have also read Metro brand & they have 966 Franchise stores doing retail for shoes but they never did this primary & secondary sales. They record sales when the Franchise partner sells to end customers using their ERP. That’s why they have debtor days of 20 days.
In this type of Setup analysts cant be able to predict if there is any channel stuffing going on or not cause I have seen this in Concalls where analysts constantly try to gauge into this primary vs secondary sales to get some ideas related to channel stuffing.
2. The TAM Mismatch -
When Manyavar was being listed , every investor was seeing it as the next Page Industries due to extraordinary margins & PAT Margins. What investors also expected was high growth with high margins which gave the stock a premium multiple. The majority of Multiples was given on the Basis of TAM.
Look, the TAM for Men’s ethnic wedding wear is around 15k Cr ( DRHP ). Here Manyavar dominates the segment , having around ~10% market share and will expand from here.
But the TAM for Women’s Ethnic Wedding Wear is around 1 lakh Cr ( DRHP ) . Here investors invested in the story of Mohey capturing the similar levels of market share around 10% and will grow from here. So 10% of market share would lead to a sales of 10,000 Cr ( from Mohey ).
But Mohey’s actual contribution is less than 200 Cr ( 180 Cr exactly ) translates to ~0.2% market share which is minuscule .
The Valuation multiples fall reason is majorly attributed to Mohey and not to Manyavar. Manyavar is doing good, although not growing like earlier.
3. MGMT constant guidance avoidance -
Whenever any analyst asks for any sort of guidance or even some estimates they hesitate to give it. The MGMT says the Wedding market is subdued for 2 years but as an analyst when I look at Titan jewellery segment sales for the same period then finds that Titan wasn’t even impacted during the same period . Although Titan has 3377 Stores and Manyavar has around 684 but they are growing around 20% YOY and Manyavar isn’t.
Even if we say that Titan is very old and much more reputed , let’s consider Senco Gold, an East India regional player in Gold Jewellery. During the same 2 year period when Manyavar’s growth was 2-3% , Senco Gold was posting 21% growth.
Why I did a comparison of Manyavar , a wedding wear brand with Senco. Well both of them try to portray themself as a Wedding brand and it cannot be true that without Gold purchase Indian Weddings are completed. The segment they carter to are the same segment.
4. Franchise Partner Concerns -
One of the analysts visited a Franchise partner of Manyavar and the partner said that they don’t want low inventory turns products like Mohey & Twamev cause they are indeed higher in ASP and margins but lower in inventory turns which feels like opportunity cost to them.
Simple means that the partners want more of Manyavar because it sells frequently , earns decent margins & annual margin is satisfactory for them and cash dont gets locked in Manyavar.
But in Mohey and Twamev , it has low inventory turns , leading to a higher Receivable days at company level, causing opportunity cost for the Franchise partners if they would have sold Manyavar for the same period.
Basically they don’t want to take the risk from the company side, they want VFL to create demand for Mohey & Twamev and when it becomes a customer pull then they are happy to give shelf space which eventually increases the inventory turns.
MGMT answered it saying Operating leverage for the stores kicks in when they also add a higher ASP range like Mohey and Twamev cause there is no extra cost to train , hire, or rent additional resources. I think both of them are right but VFL must create demand for Mohey & Twamev.
Mohey & Twamev ASP is 30% higher than that of Manyavar
5. The Low Inventory Levels in Q2 FY2026-
Generally low inventory levels are a very good sign for any business, If it’s not seasonal.
What happens here in VFL is whenever you see the P&L of Q2 of any year you will find each line item which is backward looking in nature , meaning they will provide you the data of what has happened but when you look at Inventory then you will realise what will happen in next quarter.
Inventory piling up around Q2 showcases the management confidence in upcoming sales in Q3 that’s why they generally have higher inventory during 2nd Quarter.
Even Senco Gold’s MGMT says that they increase their inventory in Q2 to cater demand in Q3 due to Festive ( Dhanteras ) and wedding seasons.
Low inventory levels shows signs that MGMT is cautious of demand.
While it came to my mind that maybe it was also due to the fact that the rise in GST from 12% to 18% compelled them to “retag” the entire batch & MGMT said that their inventory dispatch has been delayed by 18-20 days.
But the point here is not “barcode or retagging” of pricing , the concern here is that in Accounting inventory is being recorded at cost and not at Sales price. It’s not a valid point to not pile up inventory for the upcoming festive season .
And if there was a delay in despatch in Q2 of around 18-20 days then the inventory should be much higher than the average Q2 inventory of the last 3 years.
6. Not Providing Concentration Risk Data -
In DRHP VFL said sales to Top 5 Franchise EBOs were around 28% but now they don’t disclose the data for current period while Bata India ( Shoe Retailer ) discloses it.
VEDANT FASHION LTD -
BATA INDIA LTD -
Note - All those info provided here are from Annual report, DRHP, Concalls & Investor Presentation. Where needed I just shared my view. I can be totally wrong. Not a Buy/sell Reco.
Interested, Not Invested
This link is not working, what is this doc ?
Where does the margins going to settle as per management? Margins dropped from ~50% Peak to 42% in the previous quarter. Return ration are also dropped dramatically.
High margins drove the price to peak ~1500.
Top line grow also muted for the last 4 years, if margins are going to drop further to drive the top line then some more dip we can expect.
