V-Guard Industries Limited has informed the Exchange about Investor Presentation
May 19, 2022
The Manager, Listing Department, BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai- 400 001
Ref: Scrip Code: 532953
Dear Sir & Madam,
The Manager, Listing Department, National Stock Exchange of India Limited Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra-Kurla Complex, Bandra- East, Mumbai- 400 051 Ref: Scrip Code: VGUARD
Sub : Submission of Investor presentation pursuant to Regulation 30 of SEBI Oisting Obligations
and Disclosure Requirements) Regulation 2015.
Pursuant to Regulation 30 read with Para A of Part A of Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, we hereby submit the earnings presentation on Audited Financial Results of the Company for the quarter and year ended March 31, 2022.
Kindly take the above information on record.
Thanking you.
For V-Guard Industries Limited
Jayasree K Company Secretary
V-GUARD INDUSTRIES LTD. Regd. office 42/962, Vennala High School Road, Vennala, Kochi - 682 028. CIN: L31200KL1996PLC010010
P +91 484 433 5000, 200 5000 E mail@vguard.in W www.vguard.in
V-Guard Industries Q4 FY22 Earnings Presentation
Disclaimer
2
Certain statements
in this communication may be ‘forward looking
statements’ within the meaning of applicable laws and regulations. These
forward-looking statements involve a number of risks, uncertainties and
other factors that could cause actual results to differ materially from
those
suggested by
the
forward-looking statements.
Important
developments
that could affect
the Company’s operations
include
changes in the industry structure, significant changes in political and
economic environment in India and overseas, tax laws,
import duties,
litigation and labour relations.
V-Guard Industries Limited (V-Guard) will not be in any way
responsible for any action taken based on such statements and
undertakes no obligation to publicly update these forward-looking
statements to reflect subsequent events or circumstances.
Table of Contents
3
MD’s Message
Key Highlights
Financial Highlights
04
05
6-9
Segment-wise/Geographical Breakup of Revenues
10-12
Annexure
13-15
Managing Director’s Message
4
Commenting on the performance for Q4 FY22, Mr. Mithun Chittilappilly, Managing Director – V-Guard Industries Limited said, “We are pleased to report a strong performance in the fourth quarter with quarterly revenues surpassing the milestone of Rs. 1,000 crore for the first time. Despite some challenges related to the third wave in the first few weeks of the quarter, we were able to effectively carry forward the momentum from the prior quarter and end the fiscal year on a strong note. We have set new benchmarks as revenues in both Q4 and Fiscal Year FY22 are the highest ever in our history. Electricals and Consumer Durables segments achieved strong growth, while Electronics showed a moderate growth. Across geographies we have witnessed balanced growth as both South and Non-South Markets have contributed well.
Margin pressure continues in select categories due to commodity price inflation. In a competitive market, we have taken large price hikes across the portfolio over the last few quarters and will be taking further price actions wherever gaps still exist. In addition, we have instituted cost optimisation measures across our operations to support and restore margins.
During the year we had taken a conscious call to increase our inventory norms. With the risk of supply chain disruptions diminishing, we are now moving towards normative inventory levels. There has been some improvement in our working capital position as compared to the end of previous quarter. We believe we are well placed to meet customer demand over the coming months and this will enable us to get back to normal inventory levels, resulting in stronger cash flows from the business.
In February, 2022 we invested Rs. 15.17 crore in V-Guard Consumer Products (VCPL), our wholly owned subsidiary which has commissioned its first factory. The investments in VCPL will enable us to be more self-reliant in our operations as well as help us to gain long-term cost efficiencies.
As we enter a new fiscal year, V-Guard is well-positioned to benefit from the resilient customer demand given a wider product portfolio, expanded national presence and investments in capacity augmentation.”
Key Highlights – Q4 FY22
Revenue increased by 23.7% YoY in Q4 FY22
• Q4 FY22 revenue increased by 23.7% YoY to Rs. 1,050.3 crore, with 14% price growth and 9% volume growth • South and Non-South markets witnessed YoY growth of 25.4% and 21.5%, respectively • Non-South markets contributed to 42.9% of total revenues in Q4 FY22 as compared to 43.7% in Q4 FY21 • Full year revenues grew 28.7% from Rs. 2,699 crore to Rs. 3,475 crore
Stable EBITDA and increase in PAT
• Gross margins contracted by 270 bps YoY, at 28.7% in Q4 FY22 as high commodity costs continue to impact margins • Ad/promotional spends decreased, at 1.2% of revenues in Q4 FY22 as compared to 1.7% in Q4 FY21 • EBITDA at Rs. 110.8 crore in Q4 FY22 was flat compared to Rs. 109.9 crore in Q4 FY21 • EBITDA margins contracted by 230 bps YoY, at 10.6% as compared to 12.9% in Q4 FY21 • Q4 FY22 PAT of Rs. 90.6 crore, increased 32.6% YoY as we switched to the new tax regime. • Full year PAT grew by 14% from Rs. 199 crore to Rs. 227 crore
Cash flow generation and
balance sheet
• CFO generation in FY22 was negative at Rs. 34.3 crore as higher inventory was maintained to overcome possible supply disruptions • ROE and ROCE at 16.2% and 20.3% respectively for the year ended 31st March 2022 • Net cash of Rs. 43.9 crore on balance sheet as on 31st March 2022, as against Rs. 271.1 crore as on 31st March 2021 on account of
higher working capital and investments in subsidiary
5
5
P&L Snapshot
P&L Statement Particulars
Net Revenue
COGS
Gross Margin
EBITDA (excluding other income)
as a % to Net Revenue (NR)
EBITDA including other income
as a % to NR
PBT
as a % to NR
PAT
as a % to NR
Q4 FY22 (Rs. Cr)
Q4 FY21 (Rs. Cr)
Change %
Q3 FY22 (Rs. Cr)
FY22 (Rs. Cr)
FY21 (Rs. Cr)
Change %
6
1,050.27
849.10
748.37
582.24
28.7%
31.4%
110.82
109.93
10.6%
12.9%
23.7%
28.5%
-2.7%
0.8%
-2.3%
114.13
114.29
10.9%
13.5%
100.24
100.29
11.8%
-0.1%
-2.6%
0.0%
-2.3%
9.5%
90.60
8.6%
960.70
3,474.66
2,699.00
666.37
2,413.95
1,848.73
30.6%
30.5%
31.5%
84.40
332.14
306.49
8.8%
2.93
87.33
9.1%
72.46
7.5%
11.4%
9.6%
12.93
21.10
-38.7%
345.07
327.59
9.9%
12.1%
290.05
284.67
8.3%
10.5%
28.7%
30.6%
-1.0%
8.4%
-1.8%
5.3%
-2.2%
1.9%
-2.2%
14.0%
-0.8%
68.34
32.6%
52.50
226.80
198.98
8.0%
0.6%
5.5%
6.5%
7.4%
Other Income (including finance income)
3.30
4.36
-24.2%
Financial Highlights (Q4 FY22 vs. Q4 FY21)
7
Total Income (Rs. crore)
Gross Profit
1,050
849
267
302
Key ratios (%)
Gross Margin
23.7%
13.1%
EBITDA Margin (excl. other income)
Q4 FY21
Q4 FY22
Q4 FY21
Q4 FY22
Net Margin
EBITDA (Rs. crore)
PAT (Rs. crore)
Ad & Promotion Exp./ Total Revenues
110
111
68
91
Employee Cost/ Total Operating Income
Other Expenditure/ Total Operating Income
0.8%
32.6%
Q4 FY21
Q4 FY22
Q4 FY21
Q4 FY22
Tax rate
Diluted EPS (Rs.)
Q4 FY22
Q4 FY21
28.7%
10.6%
8.6%
1.2%
6.1%
12.1%
9.6%
2.09
31.4%
12.9%
8.0%
1.7%
6.7%
11.8%
31.9%
1.58
Financial Highlights (FY22 vs. FY21)
8
Total Income (Rs. crore)
3,475
2,699
Gross Profit
1,061
850
28.7%
24.7%
FY21
FY22
FY21
FY22
EBITDA (Rs. crore)
307
332
PAT (Rs. crore) 227
199
8.4%
14.0%
FY21
FY22
FY21
FY22
Key ratios (%)
Gross Margin
EBITDA Margin (excl other income)
Net Margin
Ad & Promotion Exp./ Total Revenues
Employee Cost/ Total Operating Income
Other Expenditure/ Total Operating Income
Tax rate
Diluted EPS (Rs.)
FY22
30.5%
9.6%
6.5%
1.6%
7.7%
13.3%
21.8%
5.23
FY21
31.5%
11.4%
7.4%
1.0%
8.3%
11.8%
30.1%
4.61
Financial Highlights – Balance Sheet Perspective
Balance Sheet Snapshot (Rs. Cr)
31 March 2022
31 December 2021
31 March 2021
Net Worth
Gross Debt
Cash & Cash Equivalents (inc. bank balance)
Net Cash Position (Rs. crore)
Fixed Assets
1,402.5
10.0
53.9
43.9
416.5
1,305.7
10.0
35.8
25.8
402.3
1,207.8
10.0
281.1
271.1
373.3
Balance Sheet Snapshot (Rs. Cr)
31 March 2022
31 December 2021
31 March 2021
Debtor (days)*
Inventory (days)*
Creditor (days)*
Working Capital Turnover (days)
RoE* (%)
RoCE* (%)
50
129
73
106
16.2%
20.3%
40
142
81
102
15.7%
21.7%
52
124
93
83
16.5%
22.2%
Note: *Calculations are on a trailing twelve month basis
9
9
Segment-wise Breakup – Q4 FY22 vs. Q4 FY21
10
Segment Revenue
Electronics
Electricals
Consumer Durables
Grand Total
Segment Result
Electronics
Electricals
Consumer Durables
Grand Total
Q4 FY22 (Rs. Cr)
247.1
507.3
295.9
1,050.3
Q4 FY22
(Rs. Cr)
44.2
54.5
5.0
103.6
Contribution (%)
23.5%
48.3%
28.2%
100.0%
Margin (%)
17.9%
10.7%
1.7%
9.9%
Q4 FY21 (Rs. Cr)
242.8
382.7
223.7
849.1
Q4 FY21
(Rs. Cr)
53.1
43.0
8.9
105.0
Contribution (%)
YoY growth (%)
28.6%
45.1%
26.3%
100.0%
Margin (%)
21.9%
11.2%
4.0%
12.4%
1.8%
32.6%
32.3%
23.7%
YoY growth
(%)
-16.8%
26.7%
-44.4%
-1.3%
Electronics – Stabilizers, UPS, Inverters Electricals – Wires, Pumps, Switchgears, Modular Switches Consumer Durables – Fans, Water Heaters, Kitchen Appliances, Air Coolers
Segment-wise Breakup – FY22 vs FY21
11
Segment Revenue
Electronics Electricals
Consumer Durables
Grand Total
Segment Result
Electronics Electricals Consumer Durables Grand Total
FY22 (Rs. Cr) 815.1
1,596.2
1,063.4
3,474.7
FY22 (Rs. Cr) 139.0
152.1
17.1
308.2
Contribution (%)
23.5%
45.9%
30.6%
100.0%
Margin (%)
17.1%
9.5%
1.6%
8.9%
FY21 (Rs. Cr) 758.9
1,203.5
736.7
2,699.0
FY21 (Rs. Cr) 144.2
106.5
40.3
290.9
Contribution (%)
28.1%
44.6%
27.3%
100.0%
Margin (%)
19.0%
8.8%
5.5%
10.8%
YoY growth (%) 7.4%
32.6%
44.4%
28.7%
YoY growth (%) -3.6%
42.8%
-57.5%
5.9%
Electronics – Stabilizers, UPS, Inverters Electricals – Wires, Pumps, Switchgears, Modular Switches Consumer Durables – Fans, Water Heaters, Kitchen Appliances, Air Coolers
Geographical Breakup of Revenues
12
Region
South
Non-South
Total Revenue
Region
South
Non-South
Total Revenue
Q4 FY22
(Rs. Cr)
599.2
451.1
1,050.3
FY22
(Rs. Cr)
2,024.3
1,450.4
3,474.7
Contribution (%)
57.1%
42.9%
100%
Contribution (%)
58.3%
41.7%
100.0%
Q4 FY21
(Rs. Cr)
477.9
371.1
849.1
FY21
(Rs. Cr)
1,578.3
1,120.7
2,699.0
Contribution (%)
56.3%
43.7%
100%
Contribution (%)
58.5%
41.5%
100.0%
YoY growth
(%)
25.4%
21.5%
23.7%
YoY growth
(%)
28.3%
29.4%
28.7%
Market Overview of V-Guard’s Product Portfolio
14
Electronics
Product
Total Market Size (Rs. Crs.)
Indicative Org. Market Size (%)
Industry Growth Rate (%)
VG Share in Org. Market (%)
Key Players
Stabilizers
1,700-1,800
55-60%
7-8%
42-45%
DUPS & Battery
11,500 -12,000
65-70%
8-10%
4-6%
Microtek, Livguard, Bluebird
Luminous, Microtek, Exide
Electricals
Product
Total Market Size (Rs. Crs.)
Indicative Org. Market Size (%)
Industry Growth Rate (%)
VG Share in Org. Market (%)
Key Players
House Wiring Cables 16,500 -17,000
62-65%
8-10%
6-8%
Switchgears*
3,000-3,500
75-80%
8-10%
3-5%
Modular Switches
6,000-6,500
70-75%
8-10%
**
Pumps*
3,000-3,500
60-65%
5-8%
8-10%
Polycab, Finolex, Havells
Havells, Legrand, Schneider
Anchor, Legrand, Havells
Crompton, Kirloskar, CRI
*Market estimates of VG active product segments only | ** Recent entry/ Growth plan under activation
Market Overview of V-Guard’s Product Portfolio
15
Appliances
Product
Total Market Size (Rs. Crs.)
Indicative Org. Market Size (%)
Industry Growth Rate (%)
VG Share in Org. Market (%)
Key Players
Water Heaters
2,500-2,600
65-70%
10-12%
14-16%
Havells, Bajaj, Crompton, Racold
Electric Fans
9,200-9,500
75-80%
8-10%
3-5%
Crompton, Usha, Havells, Orient Bajaj
Solar Water Heaters
500-600
60-65%
6-8%
14-16%
Sudarshan Saur, Supreme Solar
Air Coolers
4,500-5,000
30-35%
15-20%
**
Symphony, Bajaj, Voltas
Kitchen Appliances -
• Mixer Grinders • Gas Stoves • Water Purifiers • Other Small Kitchen
Appliances#
12,000-14,000
65-75%
8-10%
**
Mixer Grinders - Bajaj, Preethi, Prestige Gas Stoves - Stovekraft, Sunflame, Butterfly Water Purifiers - Eureka Forbes, Kent RO, HUL Pureit Others - Faber, Bajaj, Havells
# Includes Induction Cooktop, Rice Cooker, Sandwich Makers, Toasters, Grills, Kettles, Chimneys, etc. ** Recent entry/ Growth plan under activation
About V-Guard Industries
V-Guard Industries Limited (BSE:532953, NSE: VGUARD) is a Kochi based company, founded in 1977 by Kochouseph Chittilapilly to manufacture and market Voltage stabilizers. The Company has since then established a strong brand name and aggressively diversified to become a multi-product Company catering to the Light Electricals sector manufacturing Voltage stabilizers, Digital UPS systems & Batteries, Pumps, House wiring cables, Switch gears, Modular switches, Electric water heaters, Fans, Solar water heaters, Air coolers and various Kitchen appliances.
V-Guard outsources ~ 50% of its product profile while the rest are manufactured in – house while keeping a strong control in designs and quality. It has manufacturing facilities at Coimbatore (Tamil Nadu), Kashipur & Roorkee (Uttarakhand), Kala Amb (Himachal Pradesh) and Sikkim.
V-Guard has been a dominant player in the South market, though the last ten years have also seen the Company expanding rapidly in the non-South geographies with their contribution increasing from 5% of total revenues in FY08 to around 42% of total revenues in FY21. Significant investments continue to be made to expand its outlet coverage in the non-South geographies and become a dominant pan-India player.
V-Guard has a diversified client base and an extensive marketing & distribution network. to product and includes direct marketing agents, distributors and retailers. The Company today has a strong network of 31 branches which cover ~40,000+ retailers across the country.
Its client base differs from product
16
For further information, please contact:
Sudarshan Kasturi (Senior VP & CFO)
V-Guard Industries Limited
Tel: +91 484 300 5601
Email: sudarshan.kasturi@vguard.in
Mayank Vaswani / Shruti Joshi
CDR India
Tel: +91 982 094 0953 / +91 750 656 7349
Email: mayank@cdr-india.com / shruti@cdr-india.com
THANK YOU