Vishal Mega Mart Company Details Report
Vishal Mega Mart (VMM) is one of Indiaโs largest offline-first value retailers, catering to a population of ~1b across the middle- and lowincome segmentsVishal Mega Mart . ๏ถ VMM is a unique Indian retailer with: 1) a strong presence in tier 2+ cities (696 stores in 458 cities); 2) well-diversified exposure to key consumption basketsโApparel (44%), General Merchandise (GM) & Fast-Moving Consumer Goods (FMCG; both ~28%); 3) a strong and affordable private brands portfolio (73% revenue share); and 4) one of the lowest cost structures in the industry. ๏ถ We believe VMMโs uniqueness provides it with a strong moat against intense competition from both offline and online value retailers. ๏ถ Expect VMM to clock a revenue/EBITDA CAGR of 19%/20%, driven by: 1) ~13% CAGR in store additions, 2) consistent double-digit SSSG, and 3) modest operating leverage benefits. ๏ถ Given VMMโs debt-free balance sheet and robust cost controls, we expect ~24% PAT CAGR and cumulative pre-IND-AS OCF/FCF generation of ~INR32b/INR23b over FY25-28. ๏ถ Initiate coverage on VMM with a BUY rating and a TP of INR165, premised on DCF-implied ~45x Sepโ27E pre-INDAS 116 EV/EBITDA (implying ~31x Sepโ27E reported EBITDA and ~69x Sepโ27E P/E). 09 Page # 42 Initiate coverage with a BUY rating and a TP of INR165 10 Page # 44 Shift from unorganized to organized retail a multi-decadal growth story 11 Page # 51 Company overview 12 Page # 53 Key risks and concerns 13 Page # 55 Management background 14 Page # 56 ESG initiatives 15 Page # 57 B
Vishal Mega Mart (VMM) is one of Indiaโs largest offline-first value retailers, catering to a population of ~1b across the middle- and lowincome segmentsVishal Mega Mart . ๏ถ VMM is a unique Indian retailer with: 1) a strong presence in tier 2+ cities (696 stores in 458 cities); 2) well-diversified exposure to key consumption basketsโApparel (44%), General Merchandise (GM) & Fast-Moving Consumer Goods (FMCG; both ~28%); 3) a strong and affordable private brands portfolio (73% revenue share); and 4) one of the lowest cost structures in the industry. ๏ถ We believe VMMโs uniqueness provides it with a strong moat against intense competition from both offline and online value retailers. ๏ถ Expect VMM to clock a revenue/EBITDA CAGR of 19%/20%, driven by: 1) ~13% CAGR in store additions, 2) consistent double-digit SSSG, and 3) modest operating leverage benefits. ๏ถ Given VMMโs debt-free balance sheet and robust cost controls, we expect ~24% PAT CAGR and cumulative pre-IND-AS OCF/FCF generation of ~INR32b/INR23b over FY25-28. ๏ถ Initiate coverage on VMM with a BUY rating and a TP of INR165, premised on DCF-implied ~45x Sepโ27E pre-INDAS 116 EV/EBITDA (implying ~31x Sepโ27E reported EBITDA and ~69x Sepโ27E P/E). 09 Page # 42 Initiate coverage with a BUY rating and a TP of INR165 10 Page # 44 Shift from unorganized to organized retail a multi-decadal growth story 11 Page # 51 Company overview 12 Page # 53 Key risks and concerns 13 Page # 55 Management background 14 Page # 56 ESG initiatives 15 Page # 57 B
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Vmm is One-of-a-kind retailer catering to the ~INR70t opportunity ๏ฎ VMM is one of Indiaโs largest offline-first value retailers, catering to a population of ~1b across the middle- and low-income segments. It serves a substantial market valued at ~INR70t, which is likely to reach ~INR100t+ by CY28. ๏ฎ It has a strong footprint of 696 stores across 458 cities spanning 30 states and UT, with ~72% of its stores located in tier 2 cities and beyond. ๏ฎ VMM is a unique retailer with well-diversified exposure across key consumption basketsโApparel (44%) and GM & FMCG (both ~28%), that provides an opportunity to increase its share of customersโ wallets. ๏ฎ VMM has a strong and affordable portfolio of its private brands, which contributes ~73% of its revenue. Its private-labels in FMCG are sourced from reputed vendors such as Indo Nissin, Bikanerwala, and CCL Products and are priced at a significant discount to branded competitors. ๏ฎ The company has one of the leanest cost structures among Indian retailers, with a cost of retailing (CoR; including rentals) of ~INR1,800/sq ft (at least 20% lower than its nearest competitor). This enables VMM to offer the most competitive opening price points across several categories.
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A play on rising aspirations in Tier 2 cities and beyond Unique retailer with a diversified category mix, affordable own brands play
VMM is among the largest offline-first value retailers in India, catering to a population of ~1b in the middle- and low-income segments. It services an INR70t Indian aspirational retail market, which is expected to reach INR100t+ by CY28. ๏ฎ Strong store footprint with long runway for growth โ VMM has a strong footprint of 696 stores across 458 cities spanning 30 states and Union Territories, with ~72% stores in tier 2 cities and beyond. The company operates in a big-box retail format with an average store size of ~17.5k sqft. ๏ฎ Well-diversified category mix โ VMM boasts a well-diversified category mix with over 25% revenue contribution from three major categoriesโApparel, FMCG, and GM, which provides a large TAM and an opportunity to increase its share of customersโ wallets. Comparatively, other value-focused retailers primarily target either apparel (Zudio, V2 Retail, Style Baazar, and V-Mart) or grocery (DMart). ๏ฎ Strong and affordable own brands portfolio: VMM has a strong and affordable portfolio of own brands, which contributes ~73% of its revenue. Its private-label in FMCG are sourced from reputed vendors such as Indo Nissin, Bikanerwala, CCL Products etc. and are priced at a significant discount to branded plays. ๏ฎ Store payback in less than two years: VMMโs efficient working capital management, superior cost controls, and disciplined asset-light approach have enabled strong store economics, with ~15% pre-INDAS EBITDA margin at the store level, over 50% RoCE, and a payback period of less than two years. ๏ฎ Lean cost structure: VMM has one of the leanest cost structures among Indian retailers, with a CoR (including rentals) of ~INR1,800/sq ft (at least 20% lower than its nearest competitor). This enables the company to offer the most competitive opening price points across several categories.
VMM is among the largest offline-first value retailers in India, catering to a population of ~1b in the middle- and low-income segments. It services an INR70t Indian aspirational retail market, which is expected to reach INR100t+ by CY28. ๏ฎ Strong store footprint with long runway for growth โ VMM has a strong footprint of 696 stores across 458 cities spanning 30 states and Union Territories, with ~72% stores in tier 2 cities and beyond. The company operates in a big-box retail format with an average store size of ~17.5k sqft. ๏ฎ Well-diversified category mix โ VMM boasts a well-diversified category mix with over 25% revenue contribution from three major categoriesโApparel, FMCG, and GM, which provides a large TAM and an opportunity to increase its share of customersโ wallets. Comparatively, other value-focused retailers primarily target either apparel (Zudio, V2 Retail, Style Baazar, and V-Mart) or grocery (DMart). ๏ฎ Strong and affordable own brands portfolio: VMM has a strong and affordable portfolio of own brands, which contributes ~73% of its revenue. Its private-label in FMCG are sourced from reputed vendors such as Indo Nissin, Bikanerwala, CCL Products etc. and are priced at a significant discount to branded plays. ๏ฎ Store payback in less than two years: VMMโs efficient working capital management, superior cost controls, and disciplined asset-light approach have enabled strong store economics, with ~15% pre-INDAS EBITDA margin at the store level, over 50% RoCE, and a payback period of less than two years. ๏ฎ Lean cost structure: VMM has one of the leanest cost structures among Indian retailers, with a CoR (including rentals) of ~INR1,800/sq ft (at least 20% lower than its nearest competitor). This enables the company to offer the most competitive opening price points across several categories.
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Long runway for growth in the INR70t aspirational retail industry
๏ฎ The tier 2+ towns account for ~74% of Indiaโs retail spends (~INR56t), which remains largely dominated by unorganized retail (~90% share). ๏ฎ However, rising brand awareness, store expansion by organized retailers, and greater focus on better-quality products have led to a marked shift toward organized, one-stop shopping destinations, even in semi-urban and rural India. ๏ฎ VMM is a play on rising consumption and aspirations in Tier 2 and beyond India. Its well-diversified category mix and the lowest opening price points enable it to serve ~1b middle- and low-income consumers, representing ~INR70t aspirational retail market (as of CY23).
๏ฎ The tier 2+ towns account for ~74% of Indiaโs retail spends (~INR56t), which remains largely dominated by unorganized retail (~90% share). ๏ฎ However, rising brand awareness, store expansion by organized retailers, and greater focus on better-quality products have led to a marked shift toward organized, one-stop shopping destinations, even in semi-urban and rural India. ๏ฎ VMM is a play on rising consumption and aspirations in Tier 2 and beyond India. Its well-diversified category mix and the lowest opening price points enable it to serve ~1b middle- and low-income consumers, representing ~INR70t aspirational retail market (as of CY23).
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Healthy store economics create room for accelerated store expansions
VMMโs retail footprint spans 696 stores over 12m sq ft across 458 cities. It operates a big-box retail format, with an average store size of ~17.5k sqft. ๏ฎ During FY22-24, VMM added ~55 net stores annually. However, the pace of store additions has accelerated, with ~85 net stores added in FY25. ๏ฎ The companyโs efficient working capital management, superior cost controls, and disciplined asset-light approach have enabled strong store economics with ~15% pre-IND-AS EBITDA margin at the store level, over 50% RoCE, and a payback period of less than two years. ๏ฎ Management has indicated that VMM could potentially add 100 stores annually over the next ~15 years across 50 tier 1 cities and 1,250 tier 2 cities with populations exceeding 50k. ๏ฎ Given the long runway for growth, strong store economics, and entry into newer territories, we believe the pace of store additions will likely remain elevated over FY26-28, as VMM expands its presence in states such as Tamil Nadu, Gujarat, and Maharashtra. ๏ฎ Overall, we build in ~13% CAGR in store additions for VMM over FY25-28, taking the total store count to 1,000 by FY28.
VMMโs retail footprint spans 696 stores over 12m sq ft across 458 cities. It operates a big-box retail format, with an average store size of ~17.5k sqft. ๏ฎ During FY22-24, VMM added ~55 net stores annually. However, the pace of store additions has accelerated, with ~85 net stores added in FY25. ๏ฎ The companyโs efficient working capital management, superior cost controls, and disciplined asset-light approach have enabled strong store economics with ~15% pre-IND-AS EBITDA margin at the store level, over 50% RoCE, and a payback period of less than two years. ๏ฎ Management has indicated that VMM could potentially add 100 stores annually over the next ~15 years across 50 tier 1 cities and 1,250 tier 2 cities with populations exceeding 50k. ๏ฎ Given the long runway for growth, strong store economics, and entry into newer territories, we believe the pace of store additions will likely remain elevated over FY26-28, as VMM expands its presence in states such as Tamil Nadu, Gujarat, and Maharashtra. ๏ฎ Overall, we build in ~13% CAGR in store additions for VMM over FY25-28, taking the total store count to 1,000 by FY28.
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Well-diversified portfolio enhances VMMโs TAM and share of wallet
๏ฎ VMM boasts a well-diversified category mix with over 25% revenue contribution from three major categoriesโApparel, FMCG, and GM. ๏ฎ Comparatively, other value-focused retailers mainly target either apparel (Zudio, V2Retail, Style Baazar, and V-Mart) or grocery (DMart). ๏ฎ VMMโs diversified category mix makes it a one-stop destination for the entire family, expanding its total addressable market (TAM) and driving higher wallet share among consumers. ๏ฎ The GM and FMCG sections are typically located on the upper floors of VMM stores. Although these categories have lower gross margins compared to Apparel, they serve as a footfall driver for VMM.
๏ฎ VMM boasts a well-diversified category mix with over 25% revenue contribution from three major categoriesโApparel, FMCG, and GM. ๏ฎ Comparatively, other value-focused retailers mainly target either apparel (Zudio, V2Retail, Style Baazar, and V-Mart) or grocery (DMart). ๏ฎ VMMโs diversified category mix makes it a one-stop destination for the entire family, expanding its total addressable market (TAM) and driving higher wallet share among consumers. ๏ฎ The GM and FMCG sections are typically located on the upper floors of VMM stores. Although these categories have lower gross margins compared to Apparel, they serve as a footfall driver for VMM.
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Key risks and concerns
๏ฎ Dependence on third-party vendors for manufacturing of own brands (73% revenue share) ๏ฎ Rising competition from other offline and online value retailers ๏ฎ Inflationary risks and inability to pass on price hikes ๏ฎ Sales concentration in select states ๏ฎ Follow-on stake sales from promoters (private equity-backed) and a lack of clarity on long-term ownership
๏ฎ Dependence on third-party vendors for manufacturing of own brands (73% revenue share) ๏ฎ Rising competition from other offline and online value retailers ๏ฎ Inflationary risks and inability to pass on price hikes ๏ฎ Sales concentration in select states ๏ฎ Follow-on stake sales from promoters (private equity-backed) and a lack of clarity on long-term ownership
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Multi-category, own-brand portfolio acts as a strong moat for VMM
๏ฎ VMM has successfully established a diverse and expanding portfolio of 26 own brands across key consumption baskets, with revenue contribution from these brands steadily rising to 73% by FY25. ๏ฎ In FY25, 19 of VMMโs own brands surpassed INR1b in sales, with six brands exceeding INR5b, demonstrating strong brand acceptance. VMMโs own brands typically offer the lowest opening price points, which makes them attractive for value-conscious consumers. ๏ฎ VMM operates a 100% private label portfolio across menโs, womenโs, and kidsโ fashion, covering a wide range of categories such as denim, ethnic wear, innerwear, and sportswear. ๏ฎ The company has significantly expanded its own brand offerings in GM under the โTandemโ brand for home appliances, introducing products such as air fryers, garment steamers, sound bars, and kitchen tools. ๏ฎ VMMโs private labels account for ~35% of its FMCG revenue and hold ~45% share in categories where they are present. Moreover, the volume share is significantly higher, given the 20-50% price discount vs. leading brands.
๏ฎ VMM has successfully established a diverse and expanding portfolio of 26 own brands across key consumption baskets, with revenue contribution from these brands steadily rising to 73% by FY25. ๏ฎ In FY25, 19 of VMMโs own brands surpassed INR1b in sales, with six brands exceeding INR5b, demonstrating strong brand acceptance. VMMโs own brands typically offer the lowest opening price points, which makes them attractive for value-conscious consumers. ๏ฎ VMM operates a 100% private label portfolio across menโs, womenโs, and kidsโ fashion, covering a wide range of categories such as denim, ethnic wear, innerwear, and sportswear. ๏ฎ The company has significantly expanded its own brand offerings in GM under the โTandemโ brand for home appliances, introducing products such as air fryers, garment steamers, sound bars, and kitchen tools. ๏ฎ VMMโs private labels account for ~35% of its FMCG revenue and hold ~45% share in categories where they are present. Moreover, the volume share is significantly higher, given the 20-50% price discount vs. leading brands.
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Valuation and view
๏ฎ We expect VMM to post a revenue/EBITDA CAGR of 19%/20%, driven by: 1) ~13% CAGR in store additions, 2) consistent double-digit SSSG, and 3) modest operating leverage benefits. ๏ฎ Given VMMโs debt-free balance sheet, robust cost controls, and tight working capital management (~15 days net-working capital), we expect ~24% PAT CAGR. ๏ฎ Over FY25-28, we expect VMM to generate a cumulative OCF/FCF of ~INR32b/ INR23b, which should enable accelerated store expansions. ๏ฎ We believe the companyโs diversified category mix, ownership of opening price points, significant contribution from its own brands, and lean cost structure provide it with a strong moat against intense competition from both offline and online value retailers. ๏ฎ We initiate coverage on VMM with a BUY rating and a TP of INR165, premised on DCF-implied ~45x Sepโ27E pre-IND AS 116 EV/EBITDA (implying ~31x Sepโ27E reported EBITDA and ~69x Sepโ27E P/E). Our DCF-implied multiples are at ~4-7% premium to VMMโs average trading multiples since the listing. ๏ฎ Based on our reverse DCF analysis (10.5% risk-free rate, 6.5% terminal growth rate), our TP of INR165/share implies ~11%/13% revenue/pre-INDAS 116 EBITDA CAGR over FY25-50E, driven by ~115 store additions annually and ~4% CAGR improvement in store productivity. ๏ฎ Despite strong performance since the listing (up 75% from IPO price), we believe the risk reward remains attractive (bull: INR210/share; bear: INR120/share)
๏ฎ We expect VMM to post a revenue/EBITDA CAGR of 19%/20%, driven by: 1) ~13% CAGR in store additions, 2) consistent double-digit SSSG, and 3) modest operating leverage benefits. ๏ฎ Given VMMโs debt-free balance sheet, robust cost controls, and tight working capital management (~15 days net-working capital), we expect ~24% PAT CAGR. ๏ฎ Over FY25-28, we expect VMM to generate a cumulative OCF/FCF of ~INR32b/ INR23b, which should enable accelerated store expansions. ๏ฎ We believe the companyโs diversified category mix, ownership of opening price points, significant contribution from its own brands, and lean cost structure provide it with a strong moat against intense competition from both offline and online value retailers. ๏ฎ We initiate coverage on VMM with a BUY rating and a TP of INR165, premised on DCF-implied ~45x Sepโ27E pre-IND AS 116 EV/EBITDA (implying ~31x Sepโ27E reported EBITDA and ~69x Sepโ27E P/E). Our DCF-implied multiples are at ~4-7% premium to VMMโs average trading multiples since the listing. ๏ฎ Based on our reverse DCF analysis (10.5% risk-free rate, 6.5% terminal growth rate), our TP of INR165/share implies ~11%/13% revenue/pre-INDAS 116 EBITDA CAGR over FY25-50E, driven by ~115 store additions annually and ~4% CAGR improvement in store productivity. ๏ฎ Despite strong performance since the listing (up 75% from IPO price), we believe the risk reward remains attractive (bull: INR210/share; bear: INR120/share)
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Vishal Mega Mart 90-110
Expected level 135
Support 88
Expected level 135
Support 88
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Eureka Forbes Company Details Report
Eureka Forbes Limited (EFL) is a part of the private equity firm advent which was bought from Shapoorjipallonji group company forbes LTD . Company is engaged in the health & hygiene segment with product profiles comprising water purifiers, vacuum cleaners, air purifiers, and home security systems.
the stock price having the potential to double in 3-4Y. Under the new management, EFL (a leading health and hygiene brand) is transforming products/services and unlocking significant growth in highly underpenetrated categories of water purifiers/vacuum cleaners (EFL pioneered these and leads with ~40%/60% market shares, respectively), entering adjacent categories. Focus on category-led campaigns, affordability (models from Rs6.5k), and distribution (~20k pin codes) led to 7 straight quarters of double-digit growth despite weak sentiment/softness among peers in the other appliance category. Service momentum is reviving (double-digit AMC bookings in Q1). Despite rising R&D/marketing spends, margins rose by ~400bps in 2Y to 11% in FY25 (although lags Kentโs ~15-20%, implying major headroom). We bake in revenue/EBITDA/EPS CAGR of ~13%/20%/24% over FY25โ28E, with robust net cash of Rs2.5bn now (vs net debt in FY23), FCFE yield (~3% by FY28E), and ROCEs (+250% in FY25, adjusted for Goodwill/other Intangibles
Eureka Forbes Limited (EFL) is a part of the private equity firm advent which was bought from Shapoorjipallonji group company forbes LTD . Company is engaged in the health & hygiene segment with product profiles comprising water purifiers, vacuum cleaners, air purifiers, and home security systems.
the stock price having the potential to double in 3-4Y. Under the new management, EFL (a leading health and hygiene brand) is transforming products/services and unlocking significant growth in highly underpenetrated categories of water purifiers/vacuum cleaners (EFL pioneered these and leads with ~40%/60% market shares, respectively), entering adjacent categories. Focus on category-led campaigns, affordability (models from Rs6.5k), and distribution (~20k pin codes) led to 7 straight quarters of double-digit growth despite weak sentiment/softness among peers in the other appliance category. Service momentum is reviving (double-digit AMC bookings in Q1). Despite rising R&D/marketing spends, margins rose by ~400bps in 2Y to 11% in FY25 (although lags Kentโs ~15-20%, implying major headroom). We bake in revenue/EBITDA/EPS CAGR of ~13%/20%/24% over FY25โ28E, with robust net cash of Rs2.5bn now (vs net debt in FY23), FCFE yield (~3% by FY28E), and ROCEs (+250% in FY25, adjusted for Goodwill/other Intangibles
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From barriers to breakthrough โ Driving category growth; early success visible EFLโs leadership in highly underpenetrated categories (6%/2% in water purifiers/vacuum cleaners) offers significant growth headroom. Backed by 6x R&D and 8x A&P investments in 3Y, EFL is reshaping category perception, breaking affordability barriers, and delivering sustained double-digit product growth (vs low single-digit growth over the last decade). The focused thrust on affordability (entry models at Rs6.5k) and new product-led premiumization (~Rs15โ20k) aided growth in water purifiers. In vacuum cleaners, new offerings (3x rise in robotic SKUs in a year) and โcleaning as easy as 1-2-3โ campaign target first-time users. Robotics is now +50% of vacuum cleaner revenues. We model 13%/15% revenue CAGR over FY25โ28E for water purifiers/vacuum cleaners.
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Transformation underway in service business; digitization to act as a catalyst EFL has overhauled service offerings by moving beyond AMCs to tailored solutions, driving the installed app base to 1.6mn in FY25 (vs 140k in May-23) via an enhanced user interface. Digitization (slot-based booking, technician tracking) has lifted app-based engagement (80% complaints are online vs 33% in May-23); low penetration is being addressed via tiered AMCs (from Rs599), QR-coded filters for authenticity, and 1-hour service guarantees. While historically muted (~2% CAGR over FY23-25), early greenshoots are visible (service bookings saw double-digit growth in Q1FY26). We believe the services revenue engine will start firing, with ~13% revenue CAGR over FY25โ28E
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Sharpened focus on profitability;
valuation at 50x Sep-27E PER EFL has turned around sharply, expanding margins to ~11% in FY25 (vs ~7% in FY23) and moving to Rs2.5bn net cash despite high marketing, digital, and R&D spends. Margins, however, remain well below Kentโs ~15โ20%, offering meaningful upside potential. EFL is now embarking on its next phase of EBITDA optimization. We value EFL at 50x Sep-27E PER, on ~24% EPS CAGR, superior returns, and an asset-light model.
valuation at 50x Sep-27E PER EFL has turned around sharply, expanding margins to ~11% in FY25 (vs ~7% in FY23) and moving to Rs2.5bn net cash despite high marketing, digital, and R&D spends. Margins, however, remain well below Kentโs ~15โ20%, offering meaningful upside potential. EFL is now embarking on its next phase of EBITDA optimization. We value EFL at 50x Sep-27E PER, on ~24% EPS CAGR, superior returns, and an asset-light model.
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New leadership โ a catalyst for transformation Post-acquisition transformation โ
Adventโs playbook in action โน Leadership change: Advent installed a new management team, with Pratik Pota (exJubilant/HUL/Airtel) as the CEO, bringing a growth and execution mindset. EFL moved fast on the people strategy and built a completely new leadership team at the top 2 levels, ie CXO and CXO-1. Moreover, back in 2022, EFL launched an ESOP program covering 100% of the managers with a view to creating an employee ownership culture and to attract, retain, and motivate eligible employees for ensuring sustained growth. โน Digital revamp: Major investments were made in app-based servicing, technician tracking/platform, filter authentication, and D2C platform development (~50% of service revenue). These efforts led to ~64% of AMC bookings to be done online in FY25 (vs 28% in May-23); with 80% of the complaints logged digitally now (vs 33% in May-23). โน Product innovation - premiumization and affordability: EFL recently launched new IoT-enabled purifiers, high-end vacuum cleaners, and air quality devices, marking a shift from utility to aspirational positioning. The company also launched affordable entry models (~Rs6.5k) to bring in first-time users into the category. โน Cost discipline and a structural margin reset: The operating model was made leaner. Centralized procurement and product mix changes lifted the gross margin to ~58โ59% (vs ~54% pre-acquisition). EBITDA margin rose from ~7% in FY23 to ~11% in FY25. โน Balance sheet cleanup: EFL moved from net debt to a net-cash position of Rs2.5bn as of Q1FY26, enabling reinvestment into growth without capital strain.
Adventโs playbook in action โน Leadership change: Advent installed a new management team, with Pratik Pota (exJubilant/HUL/Airtel) as the CEO, bringing a growth and execution mindset. EFL moved fast on the people strategy and built a completely new leadership team at the top 2 levels, ie CXO and CXO-1. Moreover, back in 2022, EFL launched an ESOP program covering 100% of the managers with a view to creating an employee ownership culture and to attract, retain, and motivate eligible employees for ensuring sustained growth. โน Digital revamp: Major investments were made in app-based servicing, technician tracking/platform, filter authentication, and D2C platform development (~50% of service revenue). These efforts led to ~64% of AMC bookings to be done online in FY25 (vs 28% in May-23); with 80% of the complaints logged digitally now (vs 33% in May-23). โน Product innovation - premiumization and affordability: EFL recently launched new IoT-enabled purifiers, high-end vacuum cleaners, and air quality devices, marking a shift from utility to aspirational positioning. The company also launched affordable entry models (~Rs6.5k) to bring in first-time users into the category. โน Cost discipline and a structural margin reset: The operating model was made leaner. Centralized procurement and product mix changes lifted the gross margin to ~58โ59% (vs ~54% pre-acquisition). EBITDA margin rose from ~7% in FY23 to ~11% in FY25. โน Balance sheet cleanup: EFL moved from net debt to a net-cash position of Rs2.5bn as of Q1FY26, enabling reinvestment into growth without capital strain.
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