V-Guard Industries (532953) Q3 24/25 earnings summary

Executive summary

• Q3 FY25 consolidated revenue reached ₹1,268.65 crore, up 8.9% year-over-year, with strong electronics segment growth of 28% and moderate overall demand.

• Non-South markets delivered 15.8% year-over-year revenue growth, now contributing 48.4% of total revenue; South market grew 3.7% year-over-year.

• Gross margin improved to 36.2% from 33.7% last year, driven by higher in-house manufacturing, cost-saving initiatives, and premiumization.

• EBITDA (excluding other income) was ₹104.14 crore, up 2.5% year-over-year; EBITDA margin at 8.2%, down 50 bps due to higher A&P spend and increased employee costs.

• Net profit for Q3 FY25 was ₹60.22 crore, up from ₹58.24 crore in Q3 FY24; PAT margin at 4.7%.

Financial highlights

• Q3 FY25 revenue: ₹1,268.65 crore, up 8.9% year-over-year; 9M FY25 revenue: ₹4,039.74 crore, up 15.0% year-over-year.

• Gross margin rose by 250 bps year-over-year to 36.2%.

• EBITDA margin declined to 8.2% from 8.7% last year, mainly due to higher A&P and employee costs.

• Q3 FY25 PAT: ₹60.22 crore, up 3.4% year-over-year; EPS for Q3 FY25: ₹1.38 (basic), for 9M FY25: ₹5.09.

• Net cash position of ₹27.72 crore as of December 2024, compared to net debt of ₹145.12 crore a year earlier.

Outlook and guidance

• Performance for the nine months is in line with the annual plan; robust performance expected in the upcoming summer season.

• Management targets 10% EBITDA margin in the medium term, with incremental improvements expected as new plants mature and operating leverage increases.

• Further gross margin expansion possible as in-house manufacturing increases to 70-75% over the next 3-4 years.

• Continued focus on working capital efficiency and cash generation.

• Management continues to focus on segmental growth and operational efficiency, with segment reporting updated to reflect internal changes.