V-Guard Industries Limited Earnings Call Summary (Q2 2024)
Financial Performance
• Date of Call: July 25, 2024
• Consolidated Net Revenue: INR 1,477 crores (21.6% YoY increase)
• Segment Growth:
• Electronics: 41% increase
• Consumer Durables: 26% increase
• Electricals: 7% increase
• Sunflame brand: 7% decline
Gross Margins and Pricing Strategy
• Gross Margins: Improved to 36.3%
• Factors: Softening commodity prices and effective pricing strategies
• Price Hikes: Ongoing adjustments due to rising copper and aluminum costs
Segment Insights
• Fans Category: Price hikes driven by commodity costs
• Electronics Segment: EBIT margin influenced by product mix and commodity prices
• Electrical Consumer Durables: Changes in working capital dynamics noted
Capital Expenditure and Growth Projections
• Factory Capex: INR 100-120 crores planned over two years
• Stabilizer Business Growth: Long-term CAGR projected at 8-9%
• Digital UPS Segment: Benefiting from increased power cuts and solar solutions
Kitchen Appliances and Market Challenges
• Kitchen Segment: Facing stress for seven consecutive quarters
• New Manufacturing Facility: Expected to enhance growth by late 2024
• Sales Stability: Retail sales remain stable despite challenges
Rural Spending and Market Dynamics
• Consumer Demand: Decreased focus on kitchen category due to financial stress
• Potential Recovery: Favorable monsoon conditions may boost midterm demand
Brand Awareness and Market Presence
• Non-South Revenue Projection: INR 2,500 to INR 3,000 crores
• Brand Recognition: Strong in Southern and Eastern markets; growing in Northern and Western regions
Outsourcing and Innovation
• Outsourcing Goals: Reduce from 33% to 25% over the next few years
• Innovation Initiatives: Business plan contests to foster new ideas
Conclusion
• Sales Growth Guidance: Projected annual growth of 13% to 15%
• Management Optimism: Positive outlook for future growth despite current challenges

V-Guard Industries Limited Earnings Call Summary (May 17, 2024)
Financial Performance
• Q4 FY '24 Results:
• 17.9% year-on-year increase in consolidated net revenues (INR 1,343 crores).
• Full-year revenue of INR 4,857 crores, up 17.7%.
• Double-digit growth across all segments, especially consumer durables (27.9% growth in Q4).
• Gross Margins: Improved, with plans for enhanced in-house manufacturing.
• Dividend: Final dividend of INR 1.4 per share recommended.
Pricing Strategy
• Price Increases: Initiated in April, with plans for further increases in May based on market conditions.
• Impact of Raw Material Prices: Rising copper prices noted, but mitigated by aluminum use in other categories.
Manufacturing and Integration
• TPW Fans: 25-30% of the fan industry increasingly manufactured domestically; new factory in Hyderabad expected in 18-24 months.
• Sunflame Integration: Operates independently; focus on enhancing e-commerce and retail collaborations.
Market Trends and Demand
• Non-Summer Products: Stable demand; uptick in wire sales due to rising copper prices.
• Weather Impact: Favorable conditions compared to the previous year contributing to growth.
Investment and Growth Expectations
• Gegadyne Energy Labs: Investment aimed at enhancing competitiveness in the inverter battery market; revenue expected in 24-30 months.
• Consumer Durables Segment: Strong sales in fans and air coolers; expectations for continued growth in Sunflame brand.
Future Projections
• In-House Manufacturing: Increased from 45% to 65% over five years; expected to rise to 75% in 18 months.
• R&D and Product Development: Focus on innovation with increased capital expenditure on new molds.
Market Share and Distribution
• Switches and Switchgear Business: Optimism for growth post-acquisition of Simon; distribution network expanded to nearly 100,000 outlets.
• Market Share Measurement: Challenges due to lack of reliable data; potential for margin recovery in electronics and consumer durables sectors.

V-Guard Industries Limited Earnings Call Summary
Financial Performance
• Date of Call: February 2, 2024
• Quarter Ending: December 31, 2023
• Consolidated Net Revenue: INR 1,165 crores (18.6% YoY increase)
• Like-to-Like Growth: 10.9% (excluding Sunflame revenues)
• Gross Margins: Improved to 33.9%
• EBITDA: Increased by 52% YoY
• Profit After Tax: INR 58 crores (48% increase)
• Management Outlook: Optimistic for future growth due to seasonal demand and manufacturing expansion.
EBITDA Margin Sustainability
• Inquiry by Rahul Agarwal: Sustainability of EBITDA margins in the 9.5% to 10% range.
• Response by Mithun K Chittilappilly: Current margins expected between 9% and 9.5%, with ongoing efforts to improve margins in the ECD segment.
Sunflame Acquisition Insights
• Channel Strategy: 25% to 30% of kitchen business sales from e-commerce.
• Key Revenue Drivers: Built-in cooktops, hoods, and gas appliances.
Strategic Provisions
• Extended Producer Responsibility Legislation: Provisions of INR 4.5 crores each for inverters and batteries.
• Focus: Improving margins and accelerating sales in the inverters and batteries sector.
Fan Market Strategy
• Shift from Non-Star Rated Fans: Improved sales in Q3 due to focus on star-rated fans.
• Growth Potential: Aiming to expand fan category revenue beyond USD 100 million towards INR 1,000 crores.
Operational Changes at Sunflame
• New Executives Onboarded: CEO, CFO, and leaders for supply chain and HR.
• Focus Areas: E-commerce, modern retail, customer service, and operational efficiencies.
Electronics Segment Growth
• Weather Dependency: Growth for stabilizers and inverters is weather-dependent.
• Anticipated Growth Rate: Blended growth of 12.5% to 15% over the next few years.
Wire Business Overview
• Revenue Contribution: Wire business constitutes 27-28% of total revenues.
• Current Capacity Utilization: Approximately 68-70%.
• Planned Capex: INR 80-90 crores annually, with no significant capital expenditure expected in the next two years.
Conclusion
• Focus on Growth and Profitability: Investments in marketing and product development to drive growth in consumer durables.

V-Guard Industries Limited Q2 FY2024 Earnings Call Summary
Earnings Overview
• Date of Call: November 1, 2023
• Hosted by: ICICI Securities
• Key Management: Mithun K. Chittilappilly (Managing Director)
• Consolidated Net Revenues: Rs. 1,134 crore (15% YoY increase)
• Like-for-Like Growth: 8.7% (excluding Sunflame revenues)
• Segment Performance:
• South Market: 6.7% growth
• Non-South Markets: 11.3% growth (43.8% of total revenues)
• Electronics: 12.1% growth
• Electricals: 9.6% growth (largest revenue contributor)
• Consumer Durables: 5.1% growth (slower due to subdued demand)
• Financial Metrics:
• Gross Margins: 33.8%
• EBITDA: 26.5% YoY increase
• Profit After Tax: Rs. 59 crore (35% increase)
Consumer Durables Insights
• Fan Demand: Slowed down; no price cuts implemented, but discounts due to unusual rains.
• Air Coolers: Performed well but limited contribution to overall sales.
• ECD Margins Goal: Increase by at least 1% by March 2024 despite sluggish demand.
Strategic Investments
• Gegadyne Investment: Aimed at developing inverter and battery technology; expected to move to manufacturing in 18-24 months.
• Current Valuation of Gegadyne: Rs. 293 Crores.
Segment Challenges
• Electrical Segment Growth: Moderate growth in wires; concerns raised about lower growth compared to competitors like KEI.
• Consumer Durable Margins: Negative margins due to weaker growth and pricing challenges, particularly in fans and water heaters.
• Employee Costs: Increased by 15-16% due to variable pay and new subsidiaries.
Operational Updates
• Travel Costs: Increased due to lifted restrictions and rising hotel prices.
• In-House Manufacturing: Transitioning from 8% to 65% in-house production.
• Sales Growth: Primarily driven by volume; minimal pricing actions.
• E-commerce Success: Water purifier segment expected to expand into general trade.
• Working Capital Cycle: Improved to 68 days.
Conclusion
• Call Closure: Mithun K. Chittilappilly expressed gratitude and wished participants a Happy Diwali.
• Transcript Note: Edited for clarity; may contain errors.

V-Guard Industries Limited Q1 FY24 Earnings Call Summary
Financial Performance
• Consolidated Net Revenue: Rs. 1,215 crore (19.3% YoY increase)
• Underlying Growth: 13.1% (excluding Sunflame)
• Segment Growth:
• South Market: 9.9%
• Non-South Markets: 16.7%
• Electronics: 20%
• Consumer Durables: 10.7%
• Electricals: 10%
• Gross Margins: Improved to 32.5%
• Consolidated EBITDA: Increased by 27.7% to Rs. 105 crore
Sunflame Integration and Performance
• Current Performance: Weaker than expected, especially in kitchen appliances
• Revenue Estimate: INR 330-350 crores for the year, EBIT margins at 11-12%
• Management Focus: Improve aftersales service and business fundamentals
Margin Insights
• Electrical Segment Margins: Compressed by 1.8% due to increased A&P costs
• Target EBITDA Margins: 9% to 9.5% for FY '24, with gradual improvement expected
Consumer Durables and Inventory Management
• Focus Areas: Fans and water heaters
• High-Cost Inventory: Expected to clear by October, aiding margin recovery
• Recent Margin Recovery: Noted in water heaters and fans
Market Demand and Growth Strategy
• Market Demand: Slowdown in kitchen segment and switchgear, but optimism for recovery
• Revenue Goals: Aim for 50% from non-South markets, gradual increase projected
Manufacturing and Distribution
• In-House Production: Increased from 35% to 60%, aiming for 75% in three years
• Distribution Growth: Plans to add 3,000-4,000 retailers annually
E-commerce and Capital Expenditure
• E-commerce Growth: 20%, slower due to competition
• Capital Expenditure: INR 100 crores planned for FY '24 and FY '25
Conclusion
• Pricing Stability: No significant changes noted this quarter
• Future Outlook: Continued focus on growth and margin improvement across segments

V-Guard Industries Limited Earnings Call Summary (June 7, 2023)
Financial Performance
• Consolidated Revenue: Increased by 17.9% YoY to INR 4,126 crores.
• Non-South Market Growth: Notable growth of 26.4% YoY.
• Segment Growth:
• Electronics: 21.9% YoY increase.
• Consumer Durables: 20% YoY increase.
• Margins: Challenges due to input costs, but improvements noted in Q4.
Acquisitions and Dividends
• Acquisitions: Completed purchases of Sunflame and Simon Electric; integration efforts ongoing.
• Dividend: Recommended final dividend of INR 1.3 per share.
Market Insights
• Demand Outlook: Currently weak due to inflation and rising interest rates; potential recovery anticipated in Q2.
• Sunflame Operations: Will operate independently while leveraging V-Guard's capabilities; focus on enhancing e-commerce presence.
Growth Projections
• FY '24 Growth Expectation: Projected increase of 14% to 16%, excluding Sunflame.
• Electronics Segment: Rebounding with stabilizers driving growth; improving margins in Consumer Durables.
Challenges and Strategies
• Battery Segment: Margins under pressure despite softening lead prices.
• Chimney Procurement: Shift from imports to domestic vendors; Sunflame ramping up chimney manufacturing in India.
• Competitive Landscape: Hyper-competitiveness in southern regions; potential for future consolidation.
Distribution and Market Share
• Retailer Base Growth: Annual increase of 5% to 10%; currently estimated at 50,000 to 60,000 retailers.
• Sunflame Revenue Projection: Expected revenues between INR 400-425 crores with an EBITDA margin of 12-13%.
Future Growth and Market Trends
• Fan Market: Mature but potential growth in premium segment; average price per fan expected to rise by 20% to 30%.
• Weather Impact: Unusual weather patterns affecting sales; Southern and Eastern markets performed well.
Conclusion
• Market Strategy: Focus on margin protection while responding to competitors' pricing strategies.
• Overall Outlook: Optimism for demand revival with improved weather and consumer spending as inflation eases.

V-Guard Industries Limited Earnings Call Summary (February 3, 2023)
Financial Performance
• Q3 FY '23 Revenues: INR 981 crores, up 1.4% YoY.
• Market Performance:
• South market: -5.2% decline.
• Non-South markets: +10.5% growth (45.6% of total revenue).
• Segment Performance:
• Consumer Durables: +4.5% revenue growth.
• Electronics: -4.3% revenue decline.
• Margins:
• Gross margins: 29.6% (lower YoY, improved from last quarter).
• EBITDA margin: 7.3%, with expectations for recovery to pre-COVID levels.
Demand and Market Insights
• Demand Decline: Attributed to sustained price increases leading to consumer shock; adjustment period of 1-2 quarters expected.
• Electronics Segment: Significant margin drop due to high-cost inventory and competitive pressures; optimism for future margin recovery.
• Inventory Management: Proactive transitions expected to improve demand by late February.
Investments and Acquisitions
• Manufacturing Investments: Ongoing across multiple product categories to enhance competitiveness.
• Sunflame Acquisition: Completed in January; integration plans in progress with a focus on growth in southern markets and e-commerce.
Margin Recovery Expectations
• Durable Margins: Expected improvements in Ceiling Fans and Water Heaters by Q4 FY '23 or Q1 FY '24.
• Electrical Segment: Improved margins driven by stable performance in Wires, Switchgears, and Pumps.
Market Conditions and Strategy
• Current Market Slowdown: High inflation and interest rates affecting consumer spending; cautious optimism for recovery.
• Pricing Strategy: Focus on maintaining margins rather than aggressive price cuts; planned price increases due to rising raw material costs.
Cash Position and Future Outlook
• Cash Balance: Approximately INR 40-50 crores post-Sunflame acquisition.
• Revenue Projections: 65-70% from in-house manufacturing, potentially increasing to over 75% in five years.
• Rural vs. Urban Demand: Ongoing pressure in small towns and rural areas; strong presence of unorganized players in the pump segment.
Conclusion
• Management emphasizes the need for business normalization and restoring EBITDA margins to pre-COVID levels before further improvements can be expected.