India's V Guard misses Q3 profit view on weak demand for wires

V Guard Industries

28/01/2025 09:34

Jan 28 (Reuters) - Indian electrical appliances manufacturer V Guard Industries  VGUA.NS  reported a
smaller-than-expected rise in third-quarter profit on Tuesday, as intense competition in the wires segment pressured its
margins.
    The company's consolidated net profit rose to 602.2 million rupees ($6.96 million) for the three-month period ended
Dec. 31 from 582.4 million rupees a year earlier.
    Analysts, on average, had expected a profit of 712 million rupees, according to data compiled by LSEG.
    Revenue from operations climbed nearly 9% to 12.69 billion rupees, missing analysts' estimate of 12.94 billion rupees. 
    For further results highlights click [full story].
    
    KEY CONTEXT
    Rising demand from the real estate and power distribution sectors has boosted sales growth for consumer electrical
goods manufacturers.
    However, the high-margin wires segment is seeing intense competition.
    "Demand for wires was impacted by commodity fluctuations, thereby impacting overall growth for the electricals
segment," the company said.
    Earlier this month, peer Polycab  POLC.NS  reported a weaker-than-expected third-quarter profit, impacted by margin
pressure in the wires business.
    
PEER COMPARISON
    
    
                                     Valuation (next 12      Estimates (next 12          Analysts' sentiment           
                                           months)                months)                                          
                            RIC      PE    EV/EBI  Price/   Revenue      Profit     Mean     # of      Stock to      Div
                                            TDA    Sales   growth (%)  growth (%)  rating*  analyst     price       yield
                                                                                               s       target**      (%)
 V Guard Industries       VGUA.NS   38.13  25.12     -       14.81       26.58       Buy      17         0.79        0.38
 Havells India            HVEL.NS   53.07  36.12    4.07     14.91       23.07       Buy      24         0.82        0.66
 Crompton Greaves         CROP.NS   31.21  21.30    2.39     12.35       25.93       Buy      32         0.70        0.89
 Consumer Electricals                                                                                              
 Voltas                   VOLT.NS   41.30  33.11    2.53     16.08       37.42      Hold      33         0.81        0.39
 
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the
PT
    
    
OCTOBER-DECEMBER STOCK PERFORMANCE 
    
    
-- All data from LSEG 
-- $1 = 86.5010 Indian rupees
    

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VGuard OCT-DEC stock performance    https://tmsnrt.rs/4gc94fb
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 (Reporting by Ashna Teresa Britto; Editing by Mrigank Dhaniwala)
 ((AshnaTeresa.Britto@thomsonreuters.com;))