Currently it’s 65% and production from own facilities was only 40 pc 5 years ago
CL Jose
KOCHI: V-Guard Industries, the well-diversified company operating in multiple segments of electronics, electricals, and consumer durables, has been gradually elevating production from its plants by reducing outsourcing.
Around five years ago, V-Guard Industries had only approximately 40 per cent of its production in-house, with the remaining 60 per cent outsourced.
The scenario has been changing by the year, and the company which has already brought 65 per cent of production under its fold with in-house facilities, now aims to raise that to 75 per cent within 18 months.
“With all the new factories that are coming online, we probably expect it to go to about 75-odd-per cent in the next 18 months or so. Though the factories will scale up, maybe, within 8 to 9 months, we won’t be producing at full capacity all of a sudden. So about 75 per cent is what we can expect in the next 12 to 18 months from our manufacturing units as well as in-house manufacturing,” said Mithun K Chittilappilly, Managing Director of V-Guard Industries.
A financial analyst specializing on Kerala companies told businessbenchmark.news, “The move by V-Guard, though has been gradual, certainly reflects a significant shift towards greater self-reliance in manufacturing over the past few years.”
He added that the asset light model followed by V-Guard, which started its operations as a small unit making voltage stabilizers way back in 1977, has indeed helped the company get its feet on the ground during the struggling period of initial years of operations.
But now the scenario has changed for V-Guard with priorities also shifting to areas like competitive pricing, product range, research & development (R&D), and so on.
Performance
The company’s consolidated net profit doubled to R68.38 crore in the fourth quarter (Q4), compared with Rs32.23 crore in the same period of the previous financial year.
The board of directors has recommended a final dividend of Rs1.4 per share of a face value of Re1 each for the financial year 2023-24
The earnings per share (EPS) for Q4 increased by 42.83 per cent year on year reflecting the positive momentum achieved in the company’s financial performance.
The fourth quarter witnessed a good start to the summer season with a revival in demand. As a result, V-Guard reported consolidated net revenues of Rs1,343 crore in Q4 FY24, higher by 17.9 per cent on a year-on-year basis.
Revenues for FY24 were Rs4,857 crore, higher by 17.7 per cent over the prior year. All segments delivered double-digit growth in top-line on a year-on-year basis.
Sunflame also delivered robust growth for the quarter, leveraging various strategic initiatives implemented over the last year.
