Saraswati Saree Depot Ltd. (NSE: SSDL; BSE: 544230), one of India’s most established wholesale saree businesses, reported a significant 26.5 percent year-on-year increase in revenue from operations for the second quarter of the financial year 2025–26. Total revenue reached ₹208.39 crore for the three-month period ending September 30, 2025, up from ₹164.75 crore in the corresponding quarter of the previous year. The jump in revenue was driven primarily by strong festival-season demand and robust sales performance in its Utsav segment, which benefited from an earlier Diwali this year.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) stood at ₹14.06 crore in Q2 FY26, marking a 14.1 percent increase compared to the ₹12.32 crore recorded in the same period last year. However, the EBITDA margin fell to 6.75 percent from 7.48 percent, reflecting a 73 basis point contraction as higher depreciation costs weighed on operating leverage. Profit after tax (PAT) for the quarter rose 9.9 percent to ₹10.51 crore, while earnings per share stood at ₹2.65 for the period.
For the half-year ending September 30, 2025, the company posted consolidated revenue of ₹353.16 crore, reflecting a year-on-year increase of 19.7 percent compared to ₹295.12 crore in H1 FY25. EBITDA for the half-year period stood at ₹23.04 crore, up 14.2 percent from ₹20.17 crore, while PAT reached ₹16.86 crore, reflecting 7.6 percent growth. The EBITDA and PAT margins for H1 FY26 stood at 6.52 percent and 4.77 percent respectively, both showing mild compression due to depreciation and a higher share of volume-led growth.
Management noted that the business benefitted from disciplined execution across procurement, inventory management, and cost control. Despite margin pressures, overall profitability remained intact and the company generated healthy cash flows during the period.
What segments are driving Saraswati Saree Depot’s wholesale growth across traditional and ready-made apparel?
The core business of Saraswati Saree Depot Ltd. remains deeply embedded in the saree wholesale ecosystem, which it has served since 1966. Over the years, the company has built a diverse product catalogue exceeding 300,000 unique SKUs and serves over 13,000 active customers. It has sourced products from more than 9,000 suppliers and weavers located in major textile hubs such as Surat, Varanasi, Mau, Madurai, Dharmavaram, Kolkata and Bengaluru. This supply chain scale has been a significant contributor to the company’s resilience and ability to fulfil festive-season demand across regions.
The company’s expansion into ready-made garments in 2017 marked a strategic evolution beyond traditional sarees. Starting with Kurtis, it has progressively expanded into other product lines such as dress materials, lehengas, blouses, bottoms, pyjamas and one-piece garments. The Kurti vertical, in particular, has grown to become an award-winning segment, gaining recognition at national industry expos for its innovation and brand identity.
In Q2 FY26, the Utsav segment delivered a notable performance, supported by pre-Diwali demand and high-volume offtake across key partner networks. Management said this strong seasonal push enabled the business to capture incremental sales and build inventory momentum heading into the third quarter, which is expected to benefit further from festival tailwinds.
Chairman and Executive Director Shankar Dulhani stated that the company remains committed to enhancing its operating model through disciplined cost control, calibrated capital deployment, and continued innovation across merchandising and customer engagement. He highlighted that the early success in Utsav underscores the effectiveness of its volume-led strategy and timely product curation.
How is the company expanding beyond sarees with men’s ethnic wear and new store-level formats?
Saraswati Saree Depot Ltd. recently initiated a pilot project to test the waters in the men’s ethnic wear category. While the initiative remains in its early stages, the company noted that initial customer response has been promising. However, management refrained from drawing premature conclusions, instead indicating that it would take at least six months to assess consumer trends, category performance, and the segment’s long-term viability.
The company also provided an update on its Kolhapur store, which functions as a direct retail format within the business-to-consumer segment. According to management, the store continues to perform in line with expectations in terms of footfall, customer conversion rates, and merchandise acceptance. The leadership team remains confident that the store will meet its revenue and return on capital employed (ROCE) targets by the end of the current fiscal year, reinforcing the potential of store-format scalability for future growth.
These initiatives, while still maturing, signal a deliberate shift towards measured diversification. The company’s approach appears to be rooted in a careful evaluation of consumer demand, inventory management discipline, and sustainable margins, rather than aggressive category expansion.
What are Saraswati Saree Depot’s key strategic priorities for FY26 and how is execution being measured?
Management remains focused on executing against its long-term strategy of combining operational discipline with measured growth initiatives. The leadership team has reiterated its commitment to profitability, cash flow generation, and high-return capital allocation. From procurement efficiencies to inventory optimization and regional sales partnerships, Saraswati Saree Depot Ltd. is methodically working to strengthen each element of its value chain.
In addition to enhancing its core product verticals, the company is also laying the groundwork for future-facing categories. With early-stage experiments in men’s ethnic wear and positive B2C retail feedback, management believes there is potential for adjacent category growth and deeper customer engagement.
The current momentum in revenue, particularly from Utsav and festival-linked sales, sets a strong base for Q3 FY26 performance. Analysts tracking textile and apparel distribution believe that the company’s consistent execution, combined with a relatively under-penetrated organized wholesale market, gives Saraswati Saree Depot Ltd. room for multi-year growth.
How are markets and investors likely to respond to Saraswati Saree Depot’s quarterly performance metrics?
Although the shares of Saraswati Saree Depot Ltd. are not yet heavily tracked by institutional analysts, the Q2 FY26 performance demonstrates positive trends that are likely to resonate with long-term investors, especially those focused on SME and regional consumption themes. The revenue expansion of over 26 percent year-on-year, along with stable PAT and consistent EBITDA delivery, reflects operational momentum that could position the company favourably in upcoming quarters.
That said, margin compression and increased depreciation could trigger closer scrutiny from prospective investors, particularly around the sustainability of cost structures and segment-wise profitability. Given the company’s focus on capital-efficient expansion and its historical track record of B2B dominance, sentiment could improve further if it successfully expands its store network or scales its men’s wear pilot.
The stock’s low institutional coverage also leaves room for upward re-rating as visibility improves, especially if the company continues to report quarter-on-quarter execution against its stated roadmap.
What are the key takeaways from Saraswati Saree Depot Ltd.’s Q2 FY26 financial update and business outlook?
- Saraswati Saree Depot Ltd. reported a 26.5 percent year-on-year increase in revenue from operations in Q2 FY26, reaching ₹208.39 crore, driven by strong sales in the Utsav segment and early festive season demand.
- EBITDA rose by 14.1 percent to ₹14.06 crore for the quarter, while PAT grew 9.9 percent year-on-year to ₹10.51 crore; however, both EBITDA and PAT margins saw mild contraction due to depreciation and volume-led scaling.
- Half-year (H1 FY26) revenue stood at ₹353.16 crore, up 19.7 percent from H1 FY25, with EBITDA of ₹23.04 crore and PAT of ₹16.86 crore, reflecting consistent growth across product categories.
- Earnings per share for H1 FY26 improved to ₹4.25 from ₹3.96, showing stability in bottom-line performance despite operating margin pressures.
- The Utsav category continued to anchor festive sales momentum and is likely to remain a revenue driver in the upcoming Q3 festive cycle.
- The pilot initiative in men’s ethnic wear is underway, with encouraging early feedback; management expects more clarity on category behaviour in the next six months.
- The Kolhapur retail store remains on track to meet revenue and ROCE targets for FY26, affirming the feasibility of store-led direct-to-consumer expansion.
- Management reaffirmed its strategy of operational discipline, prudent capital allocation, and category innovation, signalling a clear roadmap for long-term value creation.
- Institutional sentiment remains neutral given limited coverage, but analysts tracking SME retail suggest potential for stock re-rating if category expansion and B2C formats scale successfully.
- With over 9,000 suppliers across major textile hubs and a SKU base exceeding 300,000 items, Saraswati Saree Depot Ltd. continues to strengthen its position as a leading wholesale apparel player with deep B2B roots.
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