Aditya Birla Lifestyle Brands Ltd lifts emerging margin to 6.8%

Aditya Birla Lifestyle Brands Ltd reported a 6.8% earnings before interest, tax, depreciation and amortisation (EBITDA) margin in its emerging business for Q2 FY27, up from 1.5% a year earlier. Revenue rose 27% to Rs 371 crore and EBITDA increased from Rs 4 crore to Rs 25 crore, supported by growth across Reebok, Van Heusen Innerwear and American Eagle.

How did ABLBL’s emerging business perform in Q2 FY27?

ABLBL’s emerging business generated revenue of Rs 371 crore in Q2 FY27, compared with Rs 292 crore in Q2 FY26, an increase of Rs 79 crore or 27%. EBITDA rose by Rs 21 crore to Rs 25 crore from Rs 4 crore, while EBITDA margin expanded 530 basis points to 6.8% from 1.5%.

ABLBL attributed the quarterly growth to portfolio performance across brands and channels, alongside an 11% retail like-to-like (LTL) increase and distribution expansion. It said Reebok, Van Heusen Innerwear and American Eagle each recorded double-digit growth, while wholesale and e-commerce partners delivered healthy secondary sales. The presentation does not disclose sales or EBITDA for the three brands individually.

The emerging business grew faster than ABLBL’s Lifestyle Brands segment in Q2 FY27. Lifestyle Brands revenue increased 9% to Rs 1,906 crore, compared with the emerging business’s 27% rise to Rs 371 crore; however, Lifestyle Brands reported a 19.5% EBITDA margin, above the emerging portfolio’s 6.8%. Lifestyle Brands EBITDA increased 10% to Rs 371 crore, while its margin rose from 19.3%.

What drove ABLBL’s emerging business margin increase?

ABLBL said larger scale and operating efficiencies drove the emerging business’s 530-basis-point margin increase to 6.8% in Q2 FY27. Revenue increased by Rs 79 crore year on year, whereas EBITDA increased by Rs 21 crore, producing a higher rate of earnings growth than revenue growth. The presentation does not quantify savings by cost line or state each brand’s contribution to the margin movement.

Retail LTL growth reached 11% in Q2 FY27 and ABLBL reported double-digit growth across retail, wholesale, e-commerce and other channels for the emerging portfolio. Consolidated channel reporting showed wholesale as the fastest-growing channel, with revenue up 18% to Rs 597 crore, ahead of e-commerce growth of 12% and retail growth of 8%. These figures cover ABLBL as a whole and cannot be used to calculate emerging business channel revenue.

Distribution activity accompanied the reported operating progress. Reebok opened its 250th store during the Q2 FY27 presentation period, while Van Heusen Innerwear highlighted expansion in key markets, distribution in premium departmental stores and scaling through quick commerce. American Eagle presented new baggy-fit, wide-leg and sweatshirt products alongside changes to its retail experience.

How did ABLBL’s H1 FY27 emerging result compare with Q2?

ABLBL’s emerging business recorded Rs 703 crore of revenue and Rs 39 crore of EBITDA in H1 FY27, producing a 5.6% margin. In H1 FY26, revenue was Rs 571 crore, EBITDA was Rs 10 crore and margin was 1.7%. The six-month comparison therefore shows 23% revenue growth and a 390-basis-point margin increase.

Q2 FY27 was more profitable than the H1 FY27 aggregate on a margin basis, at 6.8% versus 5.6%. The quarter contributed Rs 371 crore of the Rs 703 crore first-half revenue and Rs 25 crore of the Rs 39 crore first-half EBITDA. ABLBL does not separately disclose Q1 FY27 emerging business financials, so the presentation does not show the quarter-by-quarter path of the first-half improvement.

At the consolidated level, ABLBL reported H1 FY27 revenue of Rs 4,311 crore, up 11% from Rs 3,878 crore, and EBITDA of Rs 717 crore, up 15% from Rs 623 crore. Consolidated EBITDA margin rose to 16.6% from 16.1%. Lifestyle Brands accounted for Rs 3,631 crore of H1 FY27 revenue and reported a 19.0% margin, while the emerging business delivered Rs 703 crore of revenue at a 5.6% margin.

Which brands and initiatives are included in ABLBL’s emerging business?

ABLBL identifies Reebok, Van Heusen Innerwear and American Eagle within its emerging business, and said all three delivered double-digit growth in Q2 FY27. Reebok’s 250th store was the presentation’s clearest disclosed footprint milestone. Its product activity included Phantom, Comfilux for women, Reebok Yoga and Float Premier.

Van Heusen Innerwear highlighted new winterwear development, bonded underwear and anti-bacterial innerwear, as well as availability through Zepto quick commerce and premium departmental stores. The presentation displayed prices of Rs 399 and Rs 199 in Van Heusen Innerwear material, but did not specify the relevant products or quantify the revenue contribution from those price points.

American Eagle presented campaigns featuring Ananya Panday and Lamine Yamal, in addition to product launches in baggy fits, wide-leg products and sweatshirts. These activities were presented alongside the portfolio’s 11% retail LTL growth and healthy secondary sales in wholesale and e-commerce. ABLBL did not provide standalone store counts, revenue, EBITDA or margin for American Eagle.

Conclusion

ABLBL’s emerging business combined faster revenue growth with a substantial profitability improvement in Q2 FY27. Revenue increased 27% to Rs 371 crore, EBITDA rose from Rs 4 crore to Rs 25 crore and margin reached 6.8% from 1.5%. The segment’s margin remained below Lifestyle Brands’ 19.5%, but its 530-basis-point increase exceeded the established portfolio’s 20-basis-point expansion.

The next disclosure will show whether double-digit brand growth, 11% retail LTL growth and distribution activity can sustain the margin improvement. Reebok has reached 250 stores, while Van Heusen Innerwear is expanding through departmental stores and quick commerce; ABLBL has not disclosed a future margin target, brand-level earnings target or store-opening timetable for the emerging business.