V-Guard Industries Ltd A Trusted Household Name

V Guard is a Kerala based company engaged in the business of manufacturing and marketing of
electrical and electronic products. The products range of the company includes voltage
stabilizers, inverters, inverter batteries, electric and solar water heaters, fans, mixer grinders,
induction cooktops, pumps, wires and cables and domestic switch gears.
V GUARD is one of the Top 500 Stocks, identified by Dynamic Levels Research based on
technical and fundamental research.
V GUARD share price has touched a 52 week high of Rs. 1795 on 19-Aug-2016 and a 52
week low of Rs. 780 on 12 -Feb -2016, and is currently trading at Rs. 1720.

Share Holding
The promoters holding in the company stood at 65.67% while Institutions and Non-Institutions
hold 25.17% and 9.16% respectively.

Financial Analysis
Quarterly Results
During the quarter ended 30th June 2016, the total income from operations of V GUARD reported
a growth of 14.70% on Y-o-Y basis and stood at Rs. 572.68 crore against Rs. 499.29 crore in the
same quarter last year.
The operating profit of V GUARD for the quarter ended 30th June 2016 stood at Rs. 59.93 crore
against Rs. 39.61 crore in the quarter ended 30th June 2015, growing by 51.30%.
PAT grew by 70% and stood at Rs. 42.78 crore for the quarter ended 30th June 2016 against Rs.
25.16 crore in the quarter ended 30th June 2015.
EPS stood at Rs. 14.22 for Q1FY17 against Rs. 8.39 in the same period last year.

Annual Result Analysis:

The net sales of V GUARD for FY16 stood at Rs. 1849.78 crore compared to Rs. 1730.47 crore in
FY15, growing by 6.89%.
The operating profit grew by 38.34% and stood at Rs. 162.65 crore in FY16 against Rs. 117.57
crore in FY15.
PAT stood at Rs. 111.68 crore in FY16 against Rs. 70.72 crore in FY15. PAT for the year grew by
57.92%.

Investment Rationale
During the year V-Guard stabilizers were conferred with the prestigious Superbrand status.
The company expects about 15% revenue growth for FY17 and expects to focus on creating
operational efficiencies.
The company has plans to launch nextgen internet enabled Electrical Water Heaters named
Verano in early FY17. Verano will be first of its kind product.
During the year, the company launched its new ceiling fan V-Guard 4 Air and Envy a
sophisticated hands free mixer grinder and also launched an exclusive variant of stabilizers
catering to new segment of inverter ACs.
V Guard added 80 new channel partners across non South market in order to capture more
market share. Presently V Guard has a network of over 624 distributors and 5562 direct dealers.
Roll out of GST will enable shift from unorganized to organized and also substantially reduce
warehousing and logistics costs, and facilitate faster movement of goods across the country.
The company expects that owing to the strong construction demand driven by Governments
ambitious target of housing for all by 2020 will require 111 million housing units and the
products of the company will see a higher demand.
Cuts in interest rates will help in further demand for household electrical which will benefit V
Guard.

Investment Opinion
At CMP Rs. 1720, the share price of V Guard is trading at a P/E of 40.37 and V Guard has a
market cap of Rs. 5212.48 crore. We recommend a buy on the stock with a price target of
Rs. 1800 for a short term outlook.

Disclaimer
The investment advice or guidance provided by way of recommendations, reports or other ways are solely the personal views of
the research team. Users are advised to use the data for the purpose of information and rely on their own judgment while making
investment decision.
Dynamic Equities Pvt. Ltd - SEBI Investment Advisory Reg. No.: INA300002022

Disclosure
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Answers to the Best of our knowledge and belief of Dynamic/ its Associates/ Research Analyst: DYNAMIC/its Associates/
Research Analyst/ his Relative:

Do not have any financial interest / any actual/beneficial ownership in the subject company.
Do not have any other material conflict of interest at the time of publication of the research report
Have not received any compensation from the subject company in the past twelve months
Have not managed or co-managed public offering of securities for the subject company.
Have not received any compensation for brokerage services or any products / services or any compensation or other
benefits from the subject company, nor engaged in market making activity for the subject company
Have not served as an officer, director or employee of the subject company

Article Written by

Upendra Dudhewewala