Studds Accessories Limited: Riding High on Strategic Growth and Diversification in H1FY26

Studds Accessories Limited, a prominent name in the Indian helmet manufacturing sector, has reported a robust financial performance for the second quarter and first half of the financial year 2026. The company, which recently made its debut on the stock exchanges with a successful IPO on November 7, 2025, showcased steady growth across key financial metrics, underscoring the resilience and scalability of its business model.

For H1FY26, Studds Accessories Limited recorded a revenue from operations of ₹303.7 crore, marking a 6.4% year-on-year increase. The operating EBITDA saw a significant jump of 17.9% year-on-year, reaching ₹60.2 crore, while the profit after tax (PAT) grew by an impressive 22.9% year-on-year to ₹40.9 crore. This strong performance was primarily driven by a superior product mix, enhanced operating leverage, higher efficiency, and disciplined cost management. The company's basic EPS for H1FY26 stood at ₹10.38.

Segmental Performance and Strategic Mix

The company's revenue breakup by product for H1FY26 highlights the continued dominance of its core helmet brands. Studds Helmets contributed 74.4% of the total revenue, amounting to ₹225.95 crore. SMK Helmets, targeting the premium segment, accounted for 15.5% of the revenue, or ₹47.07 crore. The Daytona & Oneal brands, catering to specific export markets, made up 2.9% (₹8.81 crore), while Other Accessories contributed 7.1% (₹21.56 crore). This diversified product mix allows Studds to cater to a broad spectrum of riders, from mass-market commuters to premium enthusiasts.

Management commentary emphasized the strategic importance of this product mix, especially the growth of higher-end products, which contributes to improved gross margins. The company's average selling price (ASP) for Studds helmets is around INR700, while for SMK helmets, it stands at INR2,340, reflecting the premium positioning of the latter. This blend helps in maintaining healthy profitability despite market dynamics.

Strategic Initiatives and Future Outlook

Studds Accessories Limited is actively pursuing several strategic initiatives to sustain its growth trajectory. A significant undertaking is the capacity expansion for two-wheeler helmets and boxes, with an additional 1.5 million units planned in Phase 1, expected to be operational by Q1FY27. This expansion is part of a larger ₹150 crore capital expenditure aimed at increasing total capacity by 3 million units, projected to generate ₹270-280 crore in additional revenues.

The company has also secured a strategic engagement with Decathlon to supply bicycle helmets and allied protective products for their India requirements, with commercial production anticipated by the end of Q4FY26. This move diversifies their product offerings and strengthens their position as a trusted manufacturing partner for global brands. Furthermore, to bolster its international presence, Studds is establishing a new warehouse in Spain, which will enhance European distribution, service levels, and market penetration.

In terms of digital transformation, the company has set up a dedicated IT office in Gurugram to strengthen capabilities and advance technology-led initiatives. They are also focusing on enhancing their e-commerce platform and digital marketing efforts, with plans to explore a dedicated mobile application for direct customer engagement. This strategic pivot in their online approach, focusing on higher margins rather than just market share, reflects a pragmatic response to market realities.

Navigating Challenges and Sustaining Margins

While the outlook is positive, management acknowledged certain challenges. Raw material price volatility, particularly for plastics like styrene, remains a factor that can impact margins. The company noted that while they can pass on long-term price increases, momentary fluctuations are harder to absorb. Additionally, tariffs in export markets, such as a 50% tariff in the U.S., pose a challenge, though Studds has partially offset this with a 15% price increase and is developing a long-term strategy for these markets.

Regulatory uncertainty also plays a role, with a proposed June 2025 draft regulation mandating two helmets with every two-wheeler sale still awaiting an update. Despite these headwinds, the management expressed confidence in maintaining EBITDA margins between 20% and 21% for the full year FY26, building on the 19.8% achieved in H1FY26. The company aims for a top-line growth of 10-11% and PAT growth of 20-22% for the full year, with a long-term revenue aspiration exceeding INR1,000 crores by FY30.

Conclusion

Studds Accessories Limited is strategically positioned for sustained growth, leveraging its strong brand recognition, diversified product portfolio, and vertically integrated manufacturing capabilities. The recent IPO, coupled with robust financial performance and clear strategic initiatives, demonstrates the company's commitment to expanding its market leadership both domestically and internationally. By focusing on capacity expansion, new customer engagements, and digital transformation, Studds is poised to capitalize on the growing demand for protective gear, reinforcing its status as a leading global safety brand.