V -Guard Q2 review: Sunflame integration, consumer durable growth key drivers. H2 growth may be stronger feels the CFO

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V-Guard Industries Q2 performance, that failed to lift investor confidence as the share prices declined by more than 1% since results. The V-Guard stock after touching 52-week high in September, however, has been trading sideways ever since. V-Guard- Industries' key segments - Electronics and Electricals - reported a double-digit revenue growth.

The consumer durables segment, however, reported a single-digit growth. While integration of acquired Sunflame portfolio also lifted consolidated performance on year-on-year basis, however, Sunflame growth need to catch pace. Sunflame sales at 61.72 Crore came lower than 63.2 Crore in the previous quarter.

Also Read- RR Kabel: Up over 30% from IPO price in less than 2 months, JM Financial sees more upside – key reasons V-Guard- Industries operating revenues at 1.071.86 (excluding Sunflame) though were up 8.7% year-on-year, however declined from ₹1.147.68 Crore during the previous quarter. Including Sunflame revenues at 1133.75 Crore grew 14.9% year-on-year. V-Guard- Industries management however remains optimistic of growth picking up during the second half.

The festival season shifting to third quarter should aid growth in the consumer durables segment, said Sudarshan Kasturi, Chief Financial Officer, V-Guard Industries Ltd. The Sunflame portfolio should also see growth catching pace as the integration process is progressing well and will complete soon. The company reported gross margins at 33.8%, an improvement from 29.3% in the year ago quarter.

The benefits of declining raw material prices are being reflected. Another 100 basis points improvement may mean the V-Guard's gross margins will improve to pre covid levels, pointed out Kasturi. V-Guard- Industries Electronics segment