V-Guard Industries (532953) Q1 25/26 earnings summary

Executive summary

• Q1 FY26 consolidated revenue was INR 1,466 crore, down 0.7% YoY, due to a weak summer and high base effect.

• Consolidated net profit for the quarter was INR 74 crore, down from INR 99 crore YoY, mainly due to operating de-leveraging.

• Electronics and Electricals segments grew moderately, while Consumer Durables declined 16.3% YoY, impacted by early monsoon and weak demand.

• Non-South markets grew 2.1% YoY, now contributing 52.3% of total revenues, while South markets declined 3.3% YoY.

• Board approved the merger of Sunflame Enterprises with the holding company to accelerate synergies.

Financial highlights

• EBITDA (excluding other income) was INR 124 crore, down 20.7% YoY; EBITDA margin at 8.4%, down 210 bps YoY.

• PAT for Q1 FY26 was INR 74 crore, down 25.4% YoY; gross margin improved to 36.9% (up 20 bps YoY).

• Strong cash flow from operations at INR 134.45 crore; net cash position improved to INR 155.32 crore.

• ROE and ROCE at 13.2% and 16.7% respectively over the last 12 months.

• Diluted EPS at INR 1.68 vs. INR 2.25 YoY.

Outlook and guidance

• FY26 revenue growth is expected at 11%-13%, lower than the previous year due to a challenging Q1 and high summer dependency.

• Margins are guided to be in the 8.5%-9.5% range for FY26.

• Demand normalization is expected in coming quarters, with continued investments in brand building and capacity enhancement.

• Board approved in-principle the merger of Sunflame Enterprises to leverage synergies.