Orient Electric (ORIENTELEC) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 revenue grew to INR 660.2 crore, up 16.5% year-over-year, driven by strong performance in lighting, appliances, and fans, with support from digital initiatives and festive demand.

• Gross margin expanded by 240 bps year-over-year to 32.4%, reflecting improved product mix and cost optimization.

• EBITDA margin improved to 5.6% (INR 36 crore), up 180 bps year-over-year, with continued investments in go-to-market and service infrastructure.

• Working capital cycle improved to 19 days in Q2 FY25 from 27 days in Q2 FY24.

• Board approved unaudited financial results for the quarter and half-year ended September 30, 2024, with no material misstatements identified by auditors.

Financial highlights

• Q2 FY25 revenue: INR 660.2 crore (+16.5% YoY, -12.5% QoQ); H1 FY25 revenue: INR 1,415 crore (+11.2% YoY).

• Q2 FY25 gross profit: INR 213.8 crore (+24.5% YoY); gross margin: 32.4% (+240 bps YoY).

• Q2 FY25 EBITDA: INR 36 crore (+72.5% YoY); EBITDA margin: 5.6% (+180 bps YoY).

• Q2 FY25 PAT: INR 10.5 crore (-43.0% YoY, -27.0% QoQ); H1 FY25 PAT: INR 24.9 crore (-34.7% YoY).

• Exceptional gain of INR 18.68 crore from sale of land at Hyderabad recognized in Q2 FY25.

Outlook and guidance

• Gross margins expected to remain stable, supported by ongoing cost initiatives and premiumization.

• Premiumization strategy to expand premium product share beyond current ~30% across categories.

• Hyderabad plant ramp-up expected to support future growth in ceiling fans.

• Operating leverage from recent investments is expected to improve margins in the coming quarters, with a target to approach historical double-digit EBITDA margins next year.

• Final dividend of INR 0.75 per share for FY24 approved and paid in August 2024.