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00:00 VGAD is in focus today after they released their quarter 4 numbers.

00:03 Revenue was up by 18% on a year on year basis while EBITDA jumped 37%.

00:08 Profit however was only marginally up by 1.4% and the board has also recommended a final dividend

00:15 of Rs 1.4 per equity share. Now to put these numbers into perspective we have Mr. V Ramchandran,

00:22 the Chief Operating Officer at VGAD Industries joining us now. Mr. Ramchandran, please tell us

00:29 about your revenue and revenue growth in quarter 4. What are your expectations going forward in FY25?

00:34 We had a very strong quarter as we had been guiding through last year that we were operating

00:45 on a base of high input cost and as the input cost increases are getting addressed I think

00:56 the margin improvement is coming back in the business. We look forward to taking some more

01:03 pricing actions to address the margin erosion which had happened last year due to the

01:10 input cost increase. I think we should be able to get back to a long-term average on margins as

01:18 we go forward. I think with a good summer we have a good beginning for the current financial year

01:27 as summer categories are outperforming in terms of growth as we speak. So I think going on we

01:34 should have a good year. I think helped by a strong summer both on the top line side and

01:41 on the bottom line side. What factors have contributed to the expansion in your margins

01:47 this quarter and fiscal year? Were there any challenges and what is your outlook for FY25?

01:52 No, I think if you go back and look at last quarter performance I think fundamentally the

02:00 margin improvement has arisen as the high cost inventory has got consumed between Q2 and Q3

02:09 and the replacement costs have moved into our consumption in Q4. So I think the improvement

02:20 in margin has fundamentally been driven by the improvement in input cost. We still have a lag

02:28 in terms of pricing transmission coming out of input cost increase of last year as in many cases

02:35 market traders have still not taken pricing corrections and I think it has been a challenging

02:40 year for transmission of input for the industry. But I think the upcoming year we look forward to

02:48 pricing transmission and improved margin as we go forward. So I think fundamentally the

02:55 action is going to be on the pricing side to improve our margins. Of course,

03:03 some of the also give us a bit of operating revenue.

03:05 And in Q3 you mentioned to experience a challenging backdrop in consumer durables.

03:13 Has the seasonality revived in the current quarter given the relatively hot summer season

03:17 and which other segments have experienced traction on ground on account of the summer

03:21 season in the one, one and a half months of this quarter? Yes, so I think Q3 is a big quarter for

03:29 winter and basically I think as far as we were concerned on consumer durables, quarter three,

03:35 water heater revenues were impacted because the water heater in Q3 was flat to single digit growth.

03:41 So I think that's what kept the segment numbers down. I think as far as Q4 is concerned,

03:49 including water heater and the remaining, I think the winter did set in late last year and so we had

03:58 some benefit in quarter four of this year, which is however a small quarter for water heater.

04:03 But I think the other summer categories picked up and that is why we could deliver a strong quarter

04:09 as far as consumer durables is concerned in quarter four. I think Q1, yes, we will be

04:14 helped significantly. I think stabilizers, pumps and inverter battery, air coolers,

04:24 I think these are categories which are seeing strong traction because of a strong summer,

04:29 which has helped us particularly in Southern and Eastern markets. I think North has been a bit

04:36 slow, but I think from this month, in terms of, relatively I'm saying, versus South and East, but

04:42 from this month, we are starting to see the temperatures go up in Northern India also.

04:51 Yes, that region is also starting to respond positively because of the weather conditions.

V Guard Ind Q4: Outlook On Growth | NDTV Profit

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