Ethos Revenue Climbs 29% to ₹1,612 Cr; Profits Muted by Swiss Franc Surge

Synopsis: Driven by continued demand in the luxury watch segment and aggressive network expansion, Ethos Limited grew consolidated revenue 28.8 percent to Rs. 1,612 crore in FY26, but a Swiss Franc appreciation of approximately 26 percent against the rupee imposed an estimated Rs. 18.7 crore gross margin hit, compressing normalized EBITDA margins by 160 basis points and leaving reported PAT after minority interest virtually unchanged at Rs. 94.8 crore.

India’s largest luxury and premium watch retailer came into focus after filing its Q4 and FY26 results presentation on May 12, 2026. Revenue grew across both the full year and the fourth quarter, but the margin story was shaped by currency pressure and the cost of scaling a network from 73 to 98 boutiques within a single fiscal year.

With a market capitalization of Rs. 6,169.25 crore, the shares of Ethos Limited were trading at Rs. 2,305.6 per share, down 2.36 percent from its previous closing price of Rs. 2,361. It is trading at a P/E of 62.73.

Consolidated revenue from operations grew 28.8 percent to Rs. 1,612.2 crore in FY26 from Rs. 1,251.6 crore in FY25. On the normalized basis , EBITDA grew 13.5 percent to Rs. 182.7 crore, with margin contracting from 12.6 percent to 11.0 percent. The reported EBITDA, which includes Ind AS 116 lease adjustments, was Rs. 254.0 crore at a margin of 15.3 percent versus 16.8 percent in FY25.

Gross profit margin fell 100 basis points to 29.0 percent, a direct consequence of Swiss Franc appreciation. The CHF/INR rate moved from Rs. 96.98 in March 2025 to Rs. 122.6 by May 12, 2026, a depreciation of approximately 26 percent in the rupee against the currency in which Ethos prices most of its Swiss watch inventory.

The company estimates the total adverse gross margin impact at Rs. 18.7 crore, comprising Rs. 5.1 crore from creditor restatement and Rs. 13.6 crore from notional exchange losses and higher cost of goods sold. MD and CEO Pranav Saboo attributed the limited cost pass-through to a deliberate choice to protect long-term brand equity and customer relationships.

Reported consolidated PAT came in at Rs. 96.2 crore, flat against Rs. 96.3 crore in FY25, with PAT after minority interest at Rs. 94.8 crore, a 1.5 percent decline. Same-store sales growth of 14.2 percent indicates the existing store base remained healthy through the year; the margin dilution was largely a new-store effect.

The fourth quarter showed strong top-line momentum. Revenue grew 33.3 percent to Rs. 414.0 crore from Rs. 311.3 crore in Q4 FY25. Reported EBITDA grew 20.7 percent to Rs. 64.7 crore, though margin contracted 180 basis points to 15.1 percent. PAT after minority interest declined marginally to Rs. 22.0 crore. Six new boutiques opened during Q4, including the company’s first outlets in Jodhpur, Srinagar, Kanpur, Agra, and Faridabad.

Network Expansion and Lifestyle

Ethos added 22 boutiques during FY26, ending the year at 98 boutiques across 32 cities. The network now includes a second Haute Horology boutique in Mumbai and Rimowa’s second India location in New Delhi. Marketing spend rose 67 percent to Rs. 40 crore from Rs. 24 crore in FY25, directed at new boutique openings and brand launches.

The Lifestyle vertical, which houses Messika and Rimowa, was moved into a separate entity, Ethos Lifestyle Pvt Ltd (75.05 percent subsidiary), during FY26. On a like-for-like standalone basis including the Lifestyle contribution, PBT was Rs. 150.3 crore versus Rs. 141.3 crore in the prior period, reflecting 6.3 percent growth, a more representative measure of underlying earnings than the reported standalone number. Four new brands joined the portfolio during the year: D1 Milano, Fabergé, Unimatic, and FPM Milano. Average selling price per watch stood at Rs. 2.07 lakh, with 71 percent of watch sales now in the luxury and high-luxury category.

The company also completed a Rights Issue during FY26, raising approximately Rs. 410 crore, strengthening the balance sheet. Consolidated cash and bank balances rose from Rs. 220 crore in March 2025 to Rs. 661.7 crore in March 2026, while cash conversion cycle improved from 215 days to 180 days as inventory days normalized.

Business Overview

Ethos Limited, incorporated in 2007 and majority-owned by KDDL Limited (50.12 percent), is India’s largest luxury and premium watch retailer with 98 boutiques across 32 cities and over 380 brands in its portfolio.

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