• V-Guard Inds Ltd manufactures a range of products namely voltage stabilizers, pumps, electric water heaters, solar water heaters, cables, UPS, ceiling fans, etc.
• During 9MFY20, Weak consumer demand conditions, intense competition and also floods in certain states impacted growth across categories. VGRD registered revenue growth of 7% YoY. Growth majorly was driven by stabilizers 11% YoY, followed by UPS and fans 10% YoY growth on each.
• EBITDA up 31.56% YoY largely driven by better product mix (traction in high margin stabilizers), softening commodity prices and increasing in-house manufacturing activities.
• Weakness in consumer demand and higher competition pose a challenge. The demand recovery to be gradual. New product launches and increasing reach (majorly in the non-south market) would tend to drive growth. Margins should witness improvement. The stock assigning at 40x multiple on EPS
Disclaimer: The above report is compiled from information available on public platforms. inChat team advises users to check with certified experts before taking any investment decisions.
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