V-Guard Industries Ltd. share price target

V-Guard reported earnings CAGR of 8.6% over FY17-21 vs Havells (15.4%), Crompton (21.5%) and Polycab (39.2%). We model V-Guard’s earnings growth to be lower than peers ahead too due to (1) negligible growth in stabilizer business with improving quality and quantity of power supply pan India, (2) While V-Guard has forayed into high-growth consumer durables business, it generates lowest margin among all three segments, (3) Non-South region also offers higher
growth but lower margins and (4) V-Guard’s right-to-win in kitchen appliances also appears low

VGIL continues to focus on increasing penetration in Non-south market, new product launches and expanding retail chains. Despite downgrade in EPS, considering healthy balance sheet and...

c.46% yoy on the back of strong recovery in the consumption scenario with gradual opening up. 194 bps on yoy basis. VGIL has been quick in passing on its price increase on selected product categories like wires, cables and kitchen appliances; however, in the seasonal products such as water heaters and fans, there is a price transmission lag. The company is expected to take a price hike in these products in the following quarters to normalize its margin profile. Both the South and Non-South markets delivered a strong yoy growth of c.45% and c.49% respectively. Faster...

The company has maintained strong return ratios with RoE and RoCE at ~18% and ~24%, respectively (three year's average) Q1FY22 Results: The company reported a better-than-expected Q1FY22...

a single product company in 1990s, VGIL has expanded its product portfolio to more than 100 products across electronics, electrical and consumer durables segments. VGIL has created a primary growth drivers for the company. VGIL manufactures around 50% of the products inhouse and rest is outsourced from trusted third party vendors. VGIL now focused on moving towards in-house manufacturing and creating a strong footprint in the non- south markets. VGIL...

Q4FY21 Revenue grew by 58% YoY, on account pent-up demand. PAT grew by 110% YoY, led by strong operating performance. EBITDA margin improved by 450bps YoY to 12.9% on account of cost rationalisation and lower advertisement spends. VGIL to trade at premium valuation on account of increasing penetration in Non-south market, new product launches and expanding retail chains, strong growth in its key south market and strong balance sheet position. We might see slight hiccups in earnings due to Covid second wave. However, economic activities to normalise in Q2FY22 leading to...