CAMPUS - Campus Activewear Limited Share Price

In the Q3 FY '26 earnings call for Campus Activewear, management provided an optimistic outlook emphasizing performance driven by a solid distribution network and enhanced product offerings. Key highlights include a revenue growth of 14.3% year-over-year, reaching INR 589 crores, and a profit after tax increase of 37% year-over-year, equating to INR 63.7 crores. The average selling price (ASP) rose 5.2% to INR 711, thanks to a stronger mix of premium products.

The company is strategically expanding into the Athleisure apparel sector and has introduced its new campaign "You Go, Girl" aimed at increasing engagement within the women's segment. Significant contributions to growth were noted in the women's and kids' categories, with their share in revenue gaining from 18.7% to 22%. Management reiterated their commitment to maintaining operational efficiency and pursued disciplined execution for long-term value creation.

Looking ahead, they are focused on expanding manufacturing capabilities, notably at their Pant Nagar facility, which commenced commercial production in January 2026. Management conveyed optimism about sustained growth driven by innovations in product offerings, distribution strategies, and enhanced online presence, alongside plans to deepen market penetration of their sneaker category, which has seen volume double recently.

The management also indicated that their gross margins improved to 53.1% in Q3 FY '26, driven by a favorable product mix and operational efficiencies, and hinted at cautious optimism regarding future performance amidst ongoing market dynamics. Overall, they are positioning the company for continued market growth, with an unquantified but positive expectation for the coming quarters.

Question 1:

Videesha Sheth: "If you can break down the underlying levers of the double-digit growth. Have similar growth trends sustained?"

Answer: "The growth in Q2 and Q3 was primarily due to strong distribution and effective execution, particularly with our Sneaker lines and the women's category. Our marketing campaign, 'You Go, Girl', contributed significantly to our success. Regarding sustainability, while we cannot provide specific guidance, we feel positive about sustaining growth based on current momentum and market conditions."

Question 2:

Videesha Sheth: "Are there any focused efforts undertaken for the northern region, or is it due to weakening competition?"

Answer: "Our focus on the northern region involves state-specific strategies tailored to market needs, which we have developed over the last two quarters. This combined with our strong product line and distribution initiatives has been key to increased growth in this area."

Question 3:

Gaurav Jogani: "How much of the online growth this quarter is due to seasonal shifts, and what about the decrease in distributors?"

Answer: "Our online growth stems from a strategic pivot to a marketplace model, particularly on platforms like Amazon, which has enhanced control and performance. The reduction in distributors reflects our newer super stockist model aimed at streamlining operations and enhancing efficiency across the channel."

Question 4:

Ankit Kedia: "With the 5% ASP increase and 6% price reduction due to GST, what's driven the ASP increase?"

Answer: "The 5% increase in ASP is largely due to an improved product mix, especially with our new Sneaker lines, which have higher price points. GST adjustments don't affect ASP as they are not included in revenue calculations. Thus, we see ASP growth from product and channel mixes."

Question 5:

Aliasgar Shakir: "What has driven your numbers compared to others in the sector, especially for online growth?"

Answer: "Our success is due to comprehensive efforts, including expanding our women's category, enhancing the Sneaker portfolio, and diversified distribution. We've strengthened our online and general trade presence, resulting in a robust cash flow. Our focus has always been on profitability, not just growth."

Question 6:

Devanshu Bansal: "Will we work with lower MRP price points after the GST reduction?"

Answer: "Despite the GST reductions, our strategy will focus on enhancing value rather than reducing MRPs. The same products will provide improved value, effectively increasing consumer perception and satisfaction without pricing them lower."

Question 7:

Tejash Shah: "What is the primary value proposition of your Sneakers?"

Answer: "The Sneakers category emphasizes fashion and aesthetics rather than functionality, catering to current trends. While we ensure comfort and durability, the primary focus is to appeal visually, making them attractive for casual wear."

These summaries encapsulate the key points from the questions and responses while adhering to the specified constraints.