India Ratings and Research upgrades ratings of V2 Retail to 'A/A1' with 'positive' outlook

The agency has also upgraded VRL's short-term rating to ?IND A1? from ?IND A2+?.

India Ratings and Research stated that the upgrade reflects VRL's healthy scale growth of over 60% YoY, driven by a sustained expansion of its store network, strong same-store sales growth, and efficient inventory management, which collectively supported a steady improvement in the EBITDA to over 4,544 million in FY26.

The upgrade also factors in VRL's established position in India's value retail segment, with its growing geographical diversification, particularly in tier-2 and smaller cities, providing a competitive advantage and supporting revenue growth and earnings visibility.

Furthermore, the company's asset-light expansion strategy has enabled it to expand its footprint with limited capital intensity while maintaining financial flexibility.

However, the ratings remain constrained by the company's moderate credit metrics and the intensely competitive nature of the retail industry.

In addition, an accelerated pace of store expansion could result in a slower-than-expected ramp-up of new stores, which may put pressure on VRL?s cash flows and credit metrics.

Therefore, the execution of the company's expansion strategy and the performance of newly added stores are key rating monitorables.

V2 Retail is a leading apparel retailer catering to the three major categories, i.e. women, men, and kids wear, with its 381 stores located primarily in India?s tier-2 and smaller cities spread across 4.07 million square feet as on 30 June 2026.

The scrip fell 1.13% to currently trade at Rs 218.55 on the BSE.

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