Britannia Industries Ltd., one of India’s leading FMCG companies, has established a prominent position in the food and beverages sector, primarily focusing on bakery products. Known for its vast portfolio of biscuits, bread, cakes, dairy products, and other snacks, Britannia enjoys high brand recognition and consumer trust across India and in various international markets. Britannia is best known for its biscuit brands, commanding over 30% market share in India. Britannia has established a strong distribution network of 30000, reaching both urban and rural markets, helping it maintain a leading position in India’s competitive biscuits market. Britannia has a growing international presence, operating in over 70 countries, including the Middle East, Africa, North America, and Southeast Asia. Britannia has 13 manufacturing facilities across India, producing a wide range of products with a focus on quality and efficiency. It also has an extensive network of third-party manufacturing units. Britannia’s robust portfolio, brand strength, extensive distribution, and continuous innovation place it at a strong position within India’s FMCG sector.
Industry Outlook
The Indian Fast-Moving Consumer Goods (FMCG) industry is one of the most robust and dynamic sectors, driven by strong demand, population growth, rising income levels, and increased urbanization. The Indian FMCG sector is projected to grow at a CAGR of 10-12% over the next five years, driven by rural market expansion, rising incomes, and a favourable demographic dividend. As of recent estimates, the FMCG market in India is valued at over $110 billion, making it the fourth-largest sector in the Indian economy. Rural demand now contributes to 45-50% of total FMCG sales and is expected to continue growing. Rising disposable incomes are shifting consumption patterns toward premium and value-added products. Online FMCG sales have grown rapidly, particularly in urban areas, and are expected to account for 10-12% of FMCG sales by 2025.
Financial Summary
INR Cr.
Q1 FY25
Q2 FY25
FY23
FY24
Revenue
4250
4668
16301
16769
EBITDA
753
780
2831
3167
OPM
18%
17%
17%
19%
PBT
681
715
3033
2913
Net Profit
505
532
2316
2134
NPM
11.8%
11.4%
14.2%
12.7%
EPS
20.99
22.06
96.39
88.84
C&CE
215
250
198
446
Business Segments:
Bakery Business: It involves many sub segments in it, Biscuit is a major part of this segment and is continued to grow. Cakes are in category continuous to grow in of ₹5-10 price points products and large priced products are having substantial growth. Rusk is having some tough competition from its strong new entrants. In bread category, it is having a great growth as more demand from consumers with over turnover of ₹450 crore.
Dairy Business: It involves cheese and drinks like Lassi which is showing a healthy double digit growth. Packaged liquid milk remains a key growth driver of the industry, healthy demand and growth is also expected in cheese, yogurt and other value added dairy products.
Adjacent Business: This segment has Wafers which is highly fragmented market of ₹1000 crore. Croissant is also a product of Britannia in this segment, able to achieve good growth in urban areas. Salted snacks or packets is a growing at double digit rate and is most profitable and high volume category.
International Business: International Business for the Company is largely centered on Middle East, Americas, Africa and Asia Pacific. The business environment in these geographies is highly competitive with the presence of large local and international players. And exports contribute around 6% in the revenue.
Subsidiary Information:
These are majorly big subsidiaries of Britannia Industries established in India and all over the world. But, there are total over 25+ subsidiaries under it.
Manna Foods: Manna Foods allows Britannia to tap into the health and wellness market, expanding its footprint in the packaged foods segment. The yearly turnover for this subsidiary is ₹367 crore, It provides traditional and health-focused foods like millet-based products and ready-to-cook items.
AI Sallan Food Industries: This subsidiary helps Britannia access new markets and diversifies revenue streams outside of India. It manufactures and distributes bakery products, primarily in Oman and the Middle East. It had a main focus of international expansion and it has a turnover of ₹ 231 crore in FY24.
Britannia Nepal Pvt Ltd: This entity manufactures and distributes Britannia’s core product lines in Nepal, catering to local demand and establishing a stronger footprint in South Asia. Enables Britannia to reduce logistics costs and gain market share in Nepal’s packaged food sector.
Strategic Foods International Co. Ltd: It is based in Dubai have product categories of biscuit, cookies and cakes. Predominantly in the Middle East and Africa, where it taps into a growing demand for packaged food and snacks. It plays a key role in diversifying Britannia’s revenue streams beyond India, supporting the company’s goal of becoming a global food brand.
Q2 FY25 & Business Highlights
Revenue of ₹4668 crore in Q2 FY25 up by 5.29% YoY from ₹4433 crore in Q2 FY24.
EBITDA of ₹780 crore in this quarter at a margin of 17% compared to 20% in Q2 FY24.
Profit of ₹532 crore in this quarter compared to a ₹586 crore profit in Q2 FY24.
Metro FMCG growth rate is lower compared to Urban and Rural regions of India.
Adjacent Businesses are doing really well in cake, wafers, Rusk, Cheese and Drinks.
Commodity prices of Sugar, Cocoa, Flour Oils, etc. are increasing due to inflation, which will affect the profitability.
Capex of ₹450-₹500 crore is planned to use in FY25, through internal accruals, long-term debts and cash and use it to expand in India and International markets.
SWOT Analysis:
Strengths
Established brand with strong recognition.
Wide-ranging product portfolio.
Broad and effective distribution network.
Weaknesses
Heavy reliance on the biscuits segment.
High sensitivity to input cost fluctuations.
Opportunities
Expansion into dairy and health food categories.
Potential growth in untapped rural markets.
Opportunities for mergers, acquisitions, and partnerships.
Threats
High levels of competition in the market.
Volatility in raw material prices.
Potential impacts from economic slowdowns.
Rising health consciousness shifting consumer preferences.
Divi’s Laboratories Ltd., a major global API (Active Pharmaceutical Ingredients) manufacturer, was founded in 1990 as Divis Research Center, focusing initially on Research & Development. Today, it stands as one of the largest API companies worldwide, specializing in Intermediates, Nutraceuticals, and custom synthesis for innovator pharmaceuticals. It has a significant export-oriented business, with a presence in over 100 countries, supplying around 160 diverse products. Divi’s Laboratories Ltd. has achieved significant milestones in its growth and operations. In 1995, the company established its first manufacturing unit in Choutuppal near Hyderabad. Over the years 1997-2001, it earned ISO-9002 and OHSAS-18001 certifications, underlining its commitment to quality and safety standards. By 2002, Divi’s expanded further with a second manufacturing facility at Chippada, Visakhapatnam, which later became an Export Oriented Unit (EOU), enhancing global reach.
In 2006-2008, the company developed Divi’s Pharma SEZ in Visakhapatnam for Nutraceutical production, expanding its custom synthesis and Nutraceutical portfolio to meet rising export demand. In 2011, Divi’s launched the DSN SEZ Unit at Visakhapatnam, increasing production capacity in generic and custom synthesis segments.
From 2014-2018, Divi’s Laboratories passed multiple international regulatory inspections, including from the US FDA and COFEPRIS (Mexico), establishing EIR status for Unit-II, Visakhapatnam, which addressed previous regulatory concerns. The company invested ₹1200 crore in 2019-2020 in brownfield projects, creating DC SEZ and DCV SEZ units that became fully operational in FY2021. These projects boosted Divi’s role in generic and big pharma markets. In 2023, Divi’s launched Unit-III in Kakinada, Andhra Pradesh, further expanding production capacity.
In line with its dedication to innovation and compliance, Divi’s has research centers in Hyderabad and at manufacturing sites, focusing on custom synthesis and process innovations. With two subsidiaries—Divi’s Laboratories (USA) Inc. and Divi’s Laboratories Europe AG in Switzerland—the company enhances its reach in Nutra product markets. Divi’s continued investments in R&D, global regulatory compliance, and strategic expansion reinforce its commitment to high-quality pharmaceutical solutions, positioning it as a prominent player in the global API market.
Financial Overview
Industry Outlook
The Indian pharmaceutical sector is experiencing both near-term challenges and long-term growth potential driven by strategic expansions, cost efficiency, and new market opportunities. Key factors impacting the sector include pricing pressures in generic products and logistics challenges due to disruptions like the Red Sea crisis, which has extended shipping times and increased costs. Many companies are proactively managing inventory and supply chains to mitigate these impacts, such as advancing shipments and diversifying supply sources.
In the generic business, pricing pressure remains a challenge, but there is healthy volume growth in base businesses. Companies are expanding their portfolio to address loss of exclusivity (LOE) for several drugs, projected for 2026, which opens opportunities to capture market share in high-value molecules. This trend aligns with the pharmaceutical sector’s increasing focus on specialty and complex products and API (Active Pharmaceutical Ingredient) markets, which are seeing robust demand.
Custom synthesis continues to drive growth, with rising demand from both new and existing customers. Many companies have expanded into contrast media manufacturing, particularly iodine- and gadolinium-based molecules, which present a growing opportunity in global diagnostic markets with an annual growth rate of around 10-15%.
The API sector is well-positioned for sustained growth as global companies look for reliable alternative suppliers due to changing procurement strategies. With recent capacity expansions across SEZ units in India, companies can leverage low input costs in areas like raw materials, freight, and power to enhance profit margins. As inflation moderates globally, Indian pharmaceutical companies may also benefit from cost rationalization strategies, improving their competitiveness.
Divi’s Laboratories and other Indian firms are positioned to capitalize on the long-term trend of increased API demand and are exploring new opportunities in contract media and GLP-1 products. As the global addressable market for contrast media grows (estimated at USD 4-6 billion), firms expanding in this space can anticipate sustained demand for innovative and cost-effective solutions. Meanwhile, backward integration and advanced R&D capabilities are key strategies, enabling companies to streamline production costs and strengthen market positions over the long term.
In summary, while near-term challenges like pricing pressure and logistics disruptions persist, the pharmaceutical sector’s shift toward specialty products, cost-efficiency, and expanded capacities paints a promising outlook for the long-term. Indian companies’ strategic investments in innovation, compliance, and operational efficiency will likely enable them to maintain double-digit revenue growth while meeting the increasing demands of the global pharmaceutical market.
Business Segments
Divi’s Laboratories has demonstrated strong segmental performance across several key areas, including generic APIs, custom synthesis, peptides, contrast media, and ongoing capacity expansions at strategic units. Each of these segments reflects the company’s focus on meeting growing demand while managing industry challenges such as pricing pressures and supply chain disruptions.
Generic APIs: Divi’s generic business has experienced healthy double-digit volume growth, although pricing pressure persists across the industry. Despite the pricing environment, Divi’s has expanded its market share in smaller API molecules, highlighting the company’s resilience and strategic positioning in the generic segment. Emerging generic products have also shown robust performance, underscoring Divi’s adaptability in a competitive space.
Custom Synthesis: There is a notable increase in demand for Divi’s custom synthesis services from both new and existing clients. The future pipeline for this segment appears strong, with a robust set of products advancing through various stages of development. Key contributions from this segment are expected to start from FY26, aligning with the company’s long-term growth vision.
Peptides: Divi’s Laboratories has placed significant emphasis on GLP-1 compounds within the peptide segment, focusing on solid-phase synthesis to meet customer-specific requirements. The company is also expanding capacities for these peptide products, especially for solid-based peptides used in GLP-1 fragments, a growing therapeutic area. This focus enhances Divi’s specialty offerings, enabling it to cater to high-demand, niche markets.
Contrast Media: The contrast media segment has delivered impressive results, with volume growth of 20-30% YoY. Divi’s engagement with major clients in this area is progressing, with various projects moving to advanced stages. The company is actively working on iodine-based molecules (some nearing commercialization) and gadolinium-based molecules (in qualification stages, with potential for commercialization by FY26/27). Increased RFPs (Request for Proposals) from customers in this segment underscore the growing demand for Divi’s contrast media products.
Kakinada Unit (Unit-III): Divi’s Greenfield expansion at Kakinada is progressing as planned, with Rs. 11.8 billion spent as of H1 FY25. Production is set to commence in December 2024 in a phased manner. This unit is part of Divi’s strategy to expand capacity for both regulatory and custom synthesis products, supporting future growth in demand.
Logistics and Supply Chain: Divi’s has been proactive in managing inventory and logistics challenges, particularly those arising from the Red Sea disruptions that increased transit times to 70 days. The company has addressed these challenges by advancing shipments by 3-4 weeks and maintaining higher safety stock to minimize supply interruptions.
Key Subsidiaries and Their Information
Divi’s Laboratories operates through two major subsidiaries, Divis Laboratories (USA) Inc. and Divi’s Laboratories Europe AG. These subsidiaries play a strategic role in the company’s global expansion and focus on specialized markets for pharmaceutical ingredients, particularly in custom synthesis and nutraceuticals.
Divis Laboratories (USA) Inc.: This subsidiary caters primarily to the North American market, focusing on the distribution and marketing of nutraceutical products and custom synthesis services. It helps Divi’s Laboratories establish a strong presence in the US, one of the largest pharmaceutical markets globally, and aligns with Divi’s mission to support local customer requirements while meeting stringent regulatory standards. It contributes significantly to the company’s nutraceutical portfolio growth and has enhanced relationships with major pharmaceutical clients by providing reliable supply chains and custom synthesis offerings tailored to local industry needs.
Divi’s Laboratories Europe AG (Switzerland): This subsidiary focuses on European markets, providing nutraceutical and pharmaceutical ingredients and supporting custom synthesis projects for clients in Europe. Divi’s Laboratories Europe AG serves as a critical hub for European operations and facilitates compliance with EU regulatory standards. It also strengthens Divi’s supply chain resilience by creating a local presence in Europe, enhancing service delivery and customer support. In FY25, Divi’s Laboratories Europe AG has seen robust demand in nutraceuticals, particularly for ingredients with high-quality standards essential for the European market. This subsidiary plays a key role in Divi’s market penetration in Europe, contributing to the company’s overall revenue growth.
These subsidiaries support Divi’s Laboratories’ strategic goals of expanding its global footprint and catering to diverse regional needs in the pharmaceutical and nutraceutical industries. They also provide a platform for Divi’s to directly engage with key markets, ensuring regulatory compliance, effective supply chains, and tailored customer support, aligning with the company’s vision of global operational excellence.
Q2 FY25 Highlights
Divi’s Laboratories reported consolidated total income of ₹2,444 crore, a 22.5% increase compared to ₹1,995 crore in the same quarter of the previous year. For the half-year ended 30th September 2024, Divi’s Laboratories posted a consolidated total income of ₹4,640 crore, up by 20.4% from ₹3,854 crore in the same period of the previous year. This consistent revenue growth reflects the company’s ability to expand its product portfolio and global footprint.
Profit Before Tax (PBT) for the quarter was ₹722 crore, a substantial rise of 54% from ₹469 crore in the corresponding period last year. This increase in PBT highlights improved profitability driven by efficient operations and cost management. The PBT for the half-year was ₹1,326 crore, up from ₹961 crore, marking a 38% increase.
Profit After Tax (PAT) for the quarter stood at ₹510 crore, showing a significant 46.6% growth compared to ₹348 crore in the previous year. This reflects the company’s strong bottom-line performance, driven by both operational growth and improved cost efficiencies. PAT for the half-year was ₹940 crore, a significant 33.5% increase from ₹704 crore in the corresponding period of the previous year, reflecting robust operational performance and better margins.
The company also reported a foreign exchange (forex) gain of ₹29 crore for the quarter, which is a notable increase from the ₹1 crore gain recorded in the same quarter of the previous year. The company also recorded a forex gain of ₹28 crore for the half-year, compared to ₹14 crore in the previous year, further contributing to the positive financial results. The forex gain likely provided additional support to the bottom line.
Greenfield expansion at Kakinada Unit(III) is progressing as planned, with Rs. 11.8 billion spent as of H1 FY25. Production is set to commence in December 2024 in a phased manner. This unit is part of Divi’s strategy to expand capacity for both regulatory and custom synthesis products, supporting future growth in demand.
Divi’s has been proactive in managing inventory and logistics challenges, particularly those arising from the Red Sea disruptions that increased transit times to 70 days. The company has addressed these challenges by advancing shipments by 3-4 weeks and maintaining higher safety stock to minimize supply interruptions.
Financial Summary
INR in Cr.
Q2FY25
Q1FY25
Q2FY24
Q-o-Q (%)
Y-o-Y (%)
Revenue from Operation
2,338
2,118
1,909
10%
22%
Other Income
106
79
86
34%
23%
Total Income
2,444
2,197
1,995
11%
23%
Total Expenditure
1,622
1,496
1,430
8%
13%
Operating profit
716
622
479
15%
49%
Other Income
106
79
86
34%
23%
Interest
1
0
1
0%
0%
Depreciation
99
97
95
2%
4%
PBT
722
604
469
20%
54%
PAT
510
430
348
19%
47%
EPS (Rs.)
19.2
16.2
13.11
19%
46%
SWOT Analysis: Key Insights
Strengths
Market Leadership: Strong foothold in the industry with a leading market position.
Robust Manufacturing: Advanced manufacturing capabilities that ensure high-quality production.
Research Focus: Commitment to R&D fuels innovation and keeps the company competitive.
Outstanding Performance: Consistently strong financial and operational performance.
Weaknesses
Regulatory Risks: Exposure to regulatory changes can impact business operations.
High Dependency on API: Reliance on active pharmaceutical ingredients (API) poses risks.
Limited International Reach: Lack of significant presence in global markets limits growth potential.
Opportunities
Rising Global Demand: Increasing demand for pharmaceutical products worldwide.
New Product Development: Expanding product lines can capture new market segments.
Technological Innovations: Leveraging technology to enhance production and product quality.
Threats
Price Pressure: Competitive pricing in the market can impact profit margins.
Intense Competition: Facing stiff competition from both domestic and international players.
Supply Chain Vulnerabilities: Disruptions in the supply chain could affect operations.
On November 12, 2024, engineering giant Larsen & Toubro (L&T) has announced a major contract from NTPC for developing thermal power plants in Madhya Pradesh and Bihar. Although L&T has not disclosed the precise value of this ‘limited notice to proceed’ (LNTP) order, estimates from analysts suggest a value close to ₹22,000 crore, ranking among the company’s largest domestic projects, similar to its 2020 bullet-train contract for the Mumbai-Ahmedabad High-Speed Rail Project.
Order Details and Strategic Shift
The project includes a 2×800 MW thermal power plant at Gadarwara in Madhya Pradesh and a 3×800 MW plant at Nabinagar in Bihar. This order is particularly noteworthy as it signals a change in L&T’s strategy; the company had previously decided against bidding for thermal power projects due to unfavourable contract terms. However, recent discussions led to a strategic reversal, as explained by Subramanian Sarma, President (Energy) and Whole-Time Director of L&T, during an October media call.
Background and Historical Wins
This order win adds to L&T’s substantial order book, which stood at ₹5.1 trillion as of September 2024, with 40% of projects based internationally, especially in West Asia. L&T’s recent win rivals the scale of its 2020 contract to construct a 237.1-km section of the Mumbai-Ahmedabad high-speed rail (MAHSR) project, previously its largest engineering, procurement, and construction (EPC) contract in India.
Market Performance
On the day of the announcement, L&T’s stock closed at ₹3,547.95 on the BSE, a decrease of 1.21%. The stock price has fluctuated within a 52-week range of ₹3,031.05 to ₹3,948.60, reflecting investor responses to the company’s high-value order book and strategic shifts.
Asian Paints Ltd. is India’s largest paint manufacturer and one of the leading paint companies globally. Founded in 1942, it operates in more than 15 countries and has over 26 paint manufacturing facilities worldwide. It is No.1 or No.2 in its each segment, showing a great brand. Its product portfolio extends beyond decorative paints to include industrial paints, coatings, home decor, and waterproofing solutions, serving residential, commercial, and industrial markets. It has more than 140,000 customers and 3000+ dealers and 160,000+ retail touchpoints. The company has filed approx. 21 patents, Asian Paints has established itself as the most recognizable brand in India’s paint market. Through initiatives like the ‘Beautiful Homes Service’ and online colour consultation tools, Asian Paints enhances customer experience, leveraging digital solutions to strengthen customer engagement.
Industry Outlook
The Indian paints industry is projected to grow at a CAGR of 11-13% over the next five years, aiming to reach a valuation of ₹1.2 lakh crores by 2028. Demand for water-based paints, low-VOC (Volatile Organic Compounds) products, and anti-bacterial coatings is on the rise, driven by eco-conscious and health-focused consumers. Major players, such as Asian Paints and Berger Paints, are continuously investing in R&D for product innovation and are expanding manufacturing capacities to meet rising demand. Infrastructure growth and government focus on boosting the manufacturing sector are expected to increase demand for industrial coatings, especially in construction, automotive, and machinery sectors. Crude oil derivatives are key inputs for paint manufacturing, and price fluctuations can impact profit margins.
Financial Summary
Business Segments:
Decorative Business: The Company offers interiors and exterior wall paints, waterproof solutions, textured coatings, etc. with major products like Royale, TruCare, Apcolite, etc. It includes service of Beautiful Homes Service which shares about 4% in total revenue of company and includes services for kitchens, wardrobes, bath fittings, Sanitaryware, decorative lightings, rugs, furniture, etc. provides customers every possible services.
International Business: Asian Paints has a global footprint with manufacturing operations and markets across 15+ countries in the Middle East, South Asia, Southeast Asia, and the Caribbean. While international operations currently represent a smaller portion of total revenue, they contribute to the company’s goal of becoming a leading player in emerging markets.
Industrial Business: The Company operates in the industrial coatings segment through a 50:50 joint ventures with PPG Industries Inc. It offers custom-formulated products for the automotive and industrial sectors, including automotive, marine, and packaging coatings, as well as industrial protective coatings.
Q2 FY25 & Business Highlights
Revenue of ₹8028 crore in Q2 FY25 down by 5.32% YoY from ₹8479 crore in Q2 FY24.
EBITDA of ₹1240 crore in this quarter at a margin of 15% compared to 20% in Q2 FY24.
Profit of ₹694 crore in this quarter compared to a ₹1232 crore profit in Q2 FY24.
Decorative Business registered volume decline of 0.5% with revenue decline of 6.7%, due to weak consumer sentiments coupled with rains and floods in some part country impacted the consumption.
All categories in the Home Decor business benefited from synergies with our Beautiful Homes stores network, though at a lower clip than expectations.
Forex loss on currency devaluation (₹ 56 crore in Ethiopia) along with subdued performance in Asia impacted overall profitability
International business registered a marginal value decline despite some challenging market conditions in Ethiopia and Bangladesh. Though on a constant currency basis, the international portfolio delivered revenue growth of 8.7% for the quarter.
Subsidiary Information:
Asian paints international Pvt Ltd.: Asian Paints International Private Limited (“APIPL”), Singapore, is a wholly-owned subsidiary of the Company and is the holding company for all of its subsidiary companies carrying out operations overseas. The principal activities of APIPL are those of investment holding and management. The Board of Directors at its meeting held on 28th March 2024, approved an investment of approximately ₹200 crores by way of subscription of equity shares of APIPL, for repayment of borrowings.
Asian Paints (Nepal) Pvt Ltd: Asian Paints (Nepal) Private, is a subsidiary company of the Company. Its principal business is the manufacturing and selling of paint products in Nepal. The revenue of AP Nepal was ₹335.04 crores with de-growth of 38.5% YoY.
Obgenix Software Pvt Ltd: It is popularly known by the brand name “White Teak” is a subsidiary company of the Company. White Teak is engaged in the business of decorative lighting products, fans and other décor accessories. The revenue of White Teak was ₹133.43 crores with growth of 23.0% YoY.
Weather seal Fenestration Pvt Ltd: It is a subsidiary company of the Company. Weatherseal is engaged in the business of uPVC windows and doors. The revenue of Weatherseal was ₹51.68 crores growth of 110.0% year on year.
Zuari Agro Chemicals Ltd, incorporated in 1967, is a leading manufacturer and trader of chemical fertilizers and agricultural products under the Adventz Group. Serving farmers across India under the ‘Jai Kisaan’ brand, the company provides a range of fertilizers, pesticides, seeds, and water-soluble fertilizers to meet diverse agricultural needs. The company operates as a single-window agricultural solution provider, manufacturing high-quality complex fertilizers, including Single Super Phosphate (SSP), which enhances soil productivity. SSP, a phosphatic multinutrient fertilizer, contains 16% citrate-soluble P205, 14.5% water-soluble P205, 12% sulphur, and 21% calcium.
In FY23, Zuari Agro achieved significant production and sales volumes across various products, including Urea (~38,203 MT), Other Complex Fertilizers (~42,816 MT), and Single Super Phosphate (SSP) (~100,029 MT). Sales figures for Urea reached ~46,674 MT, while Di-Ammonium Phosphate sales stood at ~8 MT and Other Complex Fertilizers at ~187 MT. The company’s total SSP sales were ~90,174 MT, broken down into Granular SSP (~77,886 MT) and Powdered SSP (~12,288 MT), with Maharashtra contributing ~75,640 MT and Karnataka ~14,534 MT. For FY24, Zuari Agro plans to boost SSP sales to ~1.25 lakh MT, including 103,407 MT Granular and 21,864 MT Powdered.
The revenue composition for FY23 showed Finished Products accounting for 61% of revenue, Traded Products at 8%, Interest Income at 4%, and Profit from Asset Disposal at 23%. In FY22, Zuari Agro executed a Business Transfer Agreement with Pradeep Phosphates Limited (PPL), approving a slump sale of its Goa fertilizer plant and associated business assets for USD 280 million. PPL is a subsidiary of Zuari Maroc Phosphates Pvt Ltd, a 50:50 joint venture with Office Chérifien des Phosphates (OCP).
In addition, the company provided Inter-Corporate Deposits (ICDs) amounting to AED 60,000 to its wholly-owned subsidiary, Adventz Trading DMCC in FY23, with total ICDs of AED 1.025 million written off, pending Reserve Bank of India (RBI) approval. On February 26, 2024, Zuari Agro signed a sale deed with Zuari Infinity Pvt Ltd for 216,015 sq. meters of land in Sancoale, South Goa. All these highlights Zuari Agro’s diverse fertilizer portfolio, strategic transactions to streamline operations, and financial arrangements aimed at supporting its growth in the agricultural solutions market.
Industry Outlook
Zuari Agro Chemicals is expected to experience steady growth in FY25 and beyond, supported by multiple positive trends in the agriculture and fertilizer sectors. Key drivers for this growth include a growing emphasis on sustainable farming practices, a rise in demand for nutrient-efficient fertilizers like Single Super Phosphate (SSP), and government policies that favor balanced fertilizer use to improve crop yields. The expansion of Zuari’s Jai Kisaan brand and investments in production capacity are well-aligned with these industry trends, as they position the company to capitalize on both policy support and increasing demand for high-quality agro-inputs.
The company’s strategic move to divest non-core assets, like the sale of its Goa fertilizer plant to Paradeep Phosphates in FY22, enables it to focus on core operations, streamline its business model, and potentially improve profitability through efficient resource allocation. This restructuring aligns with its broader strategy of enhancing operational efficiency and targeting sustainable growth opportunities.
Looking at the sector overall, the Indian fertilizer market is projected to grow at a CAGR of approximately 4.3% from 2024 to 2032. This growth is largely due to increasing demand for biofertilizers and complex fertilizers as well as government incentives encouraging balanced nutrient use across the agricultural sector. Government programs like the Mission for Integrated Development of Horticulture (MIDH) and Pradhan Mantri Kisan Samman Nidhi are promoting crop diversification and increased productivity, which in turn boost demand for quality fertilizers. The sector also benefits from investments in cold storage and logistics, which are essential for minimizing post-harvest losses, thereby enhancing efficiency. The rise of digital tools, such as the Krishi-Decision Support System (Krishi-DSS), is helping farmers with vital data on soil health, weather, and crop management, which further supports growth in the fertilizer sector.
Moreover, demand is rising for specialty fertilizers, particularly phosphatic and potash-based products, as these are crucial for high-yield crops and improve soil productivity. The government’s backing of biofertilizers also reflects a growing focus on sustainable farming practices. This sectoral push for enhanced crop productivity and environmentally responsible fertilizers underlines the promising growth trajectory for companies like Zuari Agro Chemicals.
Business Segments
Zuari Agro Chemicals operates through multiple business segments, focusing primarily on manufacturing, trading, and marketing of fertilizers and other agricultural products under its Jai Kisaan brand. Here’s a breakdown of its main business activities as of FY25:
Fertilizers: Zuari produces a variety of fertilizers, including urea, diammonium phosphate (DAP), and nitrogen-phosphorus-potassium (NPK) complex fertilizers. Additionally, it offers Single Super Phosphate (SSP), a significant product aimed at enhancing soil productivity. Specialty fertilizers, which are used for specific crop needs, and water-soluble options also fall under this segment. In FY23, the company produced approximately 100,029 metric tons (MT) of SSP, among other products.
Crop Protection: Besides fertilizers, Zuari supplies pesticides and micronutrients, enhancing crop resilience and health. This segment includes both traded and manufactured goods, catering to the diverse agricultural needs of Indian farmers.
Agri-Retail: Zuari’s retail division provides an extensive range of agricultural inputs, including seeds, agrochemicals, and farming equipment. Its Jai Kisaan Junction outlets serve as hubs for agricultural solutions, offering direct access to Zuari’s products and valuable agricultural guidance.
This strategic alignment positions Zuari well to leverage growth opportunities driven by rising demand for balanced fertilizers and government support for sustainable farming. The Indian fertilizer market is expected to grow at a very fast pace, supported by government incentives and the shift towards sustainable, high-yield farming practices
Key Subsidiaries and Their Information
Zuari Agro Chemicals Limited (ZACL) operates with a network of key subsidiaries and joint ventures, which enhance its market reach, production capabilities, and product portfolio across the agri-solutions sector. Here are the primary subsidiaries and joint ventures of Zuari Agro Chemicals and their contributions:
Mangalore Chemicals and Fertilizers Limited (MCFL): MCFL is a significant subsidiary of Zuari Agro and one of India’s leading chemical fertilizer manufacturers, based in Karnataka. It produces various fertilizers, including urea, diammonium phosphate (DAP), muriate of potash (MOP), and complex fertilizers. Urea and complex fertilizers are among MCFL’s core offerings. It also supplies micronutrients and soil conditioners, providing comprehensive fertilizer solutions. MCFL’s production and distribution capabilities expand Zuari Agro’s footprint in South India, specifically enhancing its presence in the southern agricultural markets and aligning with government initiatives to promote balanced fertilizer usage.
Zuari FarmHub Limited (ZFL): ZFL as a subsidiary of Zuari Agro focuses on agricultural retail and serves as Zuari Agro’s direct channel to farmers, offering a wide range of inputs and advisory services. Through the Jai Kisaan Junction outlets, ZFL provides fertilizers, seeds, pesticides, and agricultural equipment, creating a one-stop solution for farmers. It also offers crop-specific advice and farming solutions, promoting modern and efficient agricultural practices. ZFL strengthens Zuari’s outreach to Indian farmers, helping farmers access high-quality inputs and valuable information, ultimately enhancing farm productivity.
Zuari Maroc Phosphates Private Limited (ZMPPL): It’s a Joint Venture with Office Chérifien des Phosphates (OCP) from Morocco. ZMPPL focuses on phosphatic fertilizers, with a notable stake in Paradeep Phosphates Limited. This JV leverages OCP’s global expertise in phosphates, supporting Zuari Agro’s supply chain and product diversification. This partnership helps ensure a reliable supply of phosphate, a crucial component for fertilizer production, which supports Zuari’s business resilience against supply chain fluctuations.
Paradeep Phosphates Limited (PPL): It is the Subsidiary of ZMPPL, with a major share owned by Zuari Maroc Phosphates. PPL operates one of India’s largest fertilizer plants in Paradeep, Odisha, producing DAP, NPK, and other phosphatic fertilizers The acquisition of Zuari’s Goa plant strengthened PPL’s production base, contributing to its role as a major supplier of fertilizers in eastern India. This boosts the group’s overall production capacity and its reach within the Indian market.
Zuari Yoma Agri Solutions Limited (ZYASL): ZYASL is an associate of PPL, with expertise in high-tech agricultural solutions. ZYASL specializes in crop protection and digital agriculture, supplying farmers with the latest tools and products for efficient crop management. The company works on innovations in crop protection and promotes the use of environmentally friendly products. ZYASL supports Zuari’s expansion into advanced agri-tech solutions, helping meet the growing demand for modern agricultural products and services across various Indian regions.
These subsidiaries and joint ventures position Zuari Agro as a comprehensive agri-solutions provider, enhancing its market reach, product range, and production capabilities across India. Through strategic collaborations, Zuari is able to support sustainable farming practices, align with government agriculture policies, and address the diverse needs of the Indian agricultural sector.
Q2 FY25 Highlights
Revenue and Total Income: Revenue for Q2FY25 rose slightly to ₹1,123.32 crore from ₹1,096.65 crore in Q1FY25, reflecting a 2.4% increase. Total income also increased from ₹1,106.55 crore in Q1FY25 to ₹1,140.02 crore in Q2FY25, indicating mild growth. When comparing year-over-year, revenue in Q2FY25 dropped 31.9%, down from ₹1,648.97 crore in Q2FY24. Total income similarly declined from ₹1,672.10 crore in Q2FY24 to ₹1,140.02 crore in Q2FY25, likely due to market fluctuations or changes in demand. Although there was quarter-on-quarter growth, the significant year-over-year decline indicates revenue pressure.
EBITDA: EBITDA rose from ₹1,058.26 crore in Q1FY25 to ₹1,096.05 crore in Q2FY25, suggesting improved operational efficiency and cost management. However, compared to Q2FY24, EBITDA in Q2FY25 was significantly lower, down from ₹1,617.15 crore. This decline corresponds with the revenue drop, indicating that higher costs have impacted profit margins over the year.
Interest and Tax Expenses: Interest expenses decreased to ₹43.97 crore in Q2FY25 from ₹54.95 crore in Q2FY24, reflecting effective cost management and financing cost reductions. The interest cost also fell slightly from ₹48.29 crore in Q1FY25 to ₹43.97 crore in Q2FY25. Tax expenses also declined in Q2FY25 to ₹20.04 crore compared to ₹39.03 crore in Q2FY24, consistent with the lower profits. Reduced tax and interest expenses helped mitigate some of the effects of reduced revenue on profitability.
Profit After Tax (PAT) and Consolidated Profit: The PAT for Q2FY25 was ₹28.94 crore, close to ₹27.72 crore in Q1FY25, reflecting stable profit levels quarter-to-quarter. However, PAT dropped from ₹44.63 crore in Q2FY24 to ₹28.94 crore in Q2FY25 due to lower revenue and total income. Despite the PAT decline, consolidated profit in Q2FY25 increased to ₹81.23 crore from ₹35.49 crore in Q2FY24, largely due to contributions from associates. This growth from associate contributions in Q2FY25 positively impacted consolidated profit, providing some resilience to overall earnings.
Financial Summary
INR in Cr.
Q2FY25
Q1FY25
Q2FY24
Q-o-Q(%)
Y-o-Y(%)
Revenue
1,123.32
1,096.65
1,648.97
2.4%
-31.9%
Other Income
16.70
9.90
23.13
68.7%
-27.8%
Total Income
1,140.02
1,106.55
1,672.10
3.0%
-31.8%
Total Expenditure
1,022.15
978.50
1,510.18
4.5%
-32.3%
EBITDA
1,096.05
1,058.26
1,617.15
3.6%
-32.2%
Interest
43.97
48.29
54.95
-8.9%
-20.0%
Exceptional Items
PBDT
73.90
79.76
106.97
-7.3%
-30.9%
Depreciation
24.92
25.21
23.31
-1.2%
6.9%
PBT
48.98
54.55
83.66
-10.2%
-41.5%
Tax
20.04
26.83
39.03
-25.3%
-48.7%
Profit after Tax
28.94
27.72
44.63
4.4%
-35.2%
Minority Interest
-12.19
-20.21
-31.12
-39.7%
-60.8%
Share of Associate
64.48
1.65
21.98
3807.9%
193.4%
Consolidated Profit
81.23
9.16
35.49
786.8%
128.9%
Equity Capital
42.06
42.06
42.06
0.0%
0.0%
SWOT Analysis
Strengths
Established Brand with Strong Market Presence
Broad Product Range Catering to Various Segments
Integrated Manufacturing and Efficient Supply Chain
TVS Electronics Ltd. is a prominent Indian technology solutions provider within the TVS Group, focusing on electronic products and services catering to sectors like retail, banking, and e-governance. Established in 1986 and headquartered in Chennai, TVS Electronics has a strong market presence in India and is known for its wide range of offerings, from hardware manufacturing to after-sales services. The company operates in both B2B and B2C markets, consistently evolving to meet changing consumer and enterprise technology needs. Its service network, covering over 5,000 locations across India, makes it a preferred partner for companies requiring maintenance and repair solutions. The company also acts as a distributor and solution provider for IT peripherals and other electronic products. It has various big global and Indian clients Starbucks, Bharat Petroleum, Amazon, Dell, Acer, HP, Banks like SBI, ICICI, HDFC, etc. then Paytm, PhonePe, etc.
Industry Outlook
The Indian electronics industry is expected to grow at a CAGR of around 16-18% over the next decade, driven by strong domestic demand, robust government support, and increasing interest from global investors. The Indian electronics industry is one of the fastest-growing sectors in the country, driven by rising consumer demand, government initiatives, and foreign investments. India is rapidly evolving from an electronics import-dependent nation to a manufacturing hub, as demand for electronics continues to raise across various sectors, including consumer electronics, automotive, healthcare, and IT hardware. With a focus on both domestic consumption and exports, the industry is projected to see substantial growth in the coming years. India’s electronics demand is anticipated to reach approximately $400 billion by 2025, fuelled by increasing digitization, rising incomes, and a growing middle class. India’s electronic exports are increasing, with mobile phone exports alone reaching $11 billion in FY 2022-23. This trend is supported by the country’s participation in global value chains.
Financial Summary
INR Cr.
Q1 FY25
Q2 FY25
FY23
FY24
Revenue
111.32
104.61
353
366
EBITDA
3.16
2.63
20
10
OPM
2.84%
2.51%
6%
3%
PBT
-1.12
-1.49
13
-1
Net Profit
-1.26
-1.32
10
0
NPM
-1.13%
-1.26%
2.83%
0.01%
EPS
-0.68
-0.71
5.1
0.14
C&CE
5
7
11
4
Business Segments:
Products & Solutions: It is a core segment of TVS Electronics, it makes printers, cash machines, mobile handsets, keyboards are a major part, then provides software services also. It has clients in segments like retail, manufacturing, healthcare & hospitality, Banking and Financial services, IT, Audio, Solar companies and large government companies are also clients of this company. It also provides a one-stop solution service to its clients. It earned a revenue of ₹73.10 crore in this quarter.
Customer Support Services: In this segment, company offers after sales support services for many global and Indian clients. Provides field support to consumer electronics, solar customers, electric vehicles, etc. to make it seamless for the company’s clients. It also provides repair and management services for display panels, payment sound boxes and electronics. The in-house CRM platform integrates AI and machine learning capabilities to connect brands, service partners, parts management, and logistics seamlessly.
Q2 FY25 & Business Highlights
Revenue of ₹104.61 crore in Q2 FY25 up by 13.4% YoY from ₹92.19 crore in Q2 FY24.
EBITDA of ₹2.63 crore in this quarter at a margin of 2.51% compared to 4.18% in Q2 FY24.
Loss of ₹-1.32 crore in this quarter compared to a ₹1.12 crore profit in Q2 FY24.
The Product & Solution segment registered a YoY growth of 8.3% in revenue in Q2FY25 with revenue of ₹ 731 mn.
The customer support service vertical generated revenue of INR 315 Mn in Q2-FY25, representing an increase of 27.5% YoY and an increase of 15.8% on QoQ basis.
The top 10 customer concentration is reduced to 30% from 41% in FY20.
There was also an increase in finance costs on YoY basis, incurred for servicing the loans procured for capital investments and working capital requirements.
SWOT Analysis:
Strengths
Established Brand with Strong Legacy
Diverse Product Portfolio
Extensive Service Network Across India
Weaknesses
Highly Competitive Market Environment
Lower Profit Margins
Heavy Reliance on Domestic Market
Opportunities
Potential for New Product Line Expansions
Government Support for Local Manufacturing
Growing Demand for After-Sales and Support Services
Established in 1945 as Tata Engineering and Locomotive Co. Ltd, Tata Motors began as a locomotive manufacturer, unveiling its first steam road roller in 1948 and introducing medium commercial vehicles in collaboration with Daimler Benz by 1954. The company expanded rapidly, launching India’s first indigenous passenger car, the Tata Sierra, and diversifying into both light and heavy commercial vehicles. Tata Motors has built a strong global presence through key acquisitions, including South Korea’s Daewoo Commercial Vehicle in 2004 and Jaguar Land Rover (JLR) in 2008, marking its entry into the luxury market. Supported by research and design centers in India, the UK, Italy, and Korea, Tata Motors markets vehicles across Europe, Africa, South Asia, and Australia. Domestically, Tata Motors leads in the commercial vehicle market and holds a significant share in passenger vehicles, with products ranging from sub-1-ton trucks to 49-ton heavy-duty models, manufactured in multiple plants across India. Known for innovation, the company launched the Tata Nano, among the world’s most affordable cars, solidifying its reputation for durable and cost-effective vehicles.
Between 2017 and 2023, Tata Motors pioneered India’s electric vehicle (EV) market with the Tigor EV, later expanding its EV lineup with models like the Tiago EV and Tata Ace EV, the country’s first electric mini-truck. The launch of Tata Passenger Electric Mobility Limited (TPEML) in FY 2022-23, supported by a Rs. 7,500 crore investment from TPG Rise Climate, emphasized Tata’s commitment to an EV ecosystem. Product expansions included the new Safari and Punch (India’s first sub-compact SUV) in passenger vehicles, along with CNG variants of the Tiago and Tigor. In commercial vehicles, Tata Motors introduced India’s first CNG-powered Medium & Heavy Commercial Vehicle (M&HCV) and specialized models like the Yodha 2.0 and Intra series, catering to agriculture, logistics, and e-commerce sectors. Tata Motors also enhanced customer support by introducing a 6-year warranty on M&HCV trucks in 2018 and launched Tata Motors Genuine Oil to optimize commercial vehicle performance.
The company’s international reach has been bolstered by JLR subsidiaries in Europe, North America, and Asia, alongside strategic acquisitions like Spark44 Taiwan and Brabo Robotics, aligning with advanced automation and electric mobility. With investments of Rs. 36,636 Crores in FY 2019 and Rs. 31,222 Crores in FY 2020 for R&D and expansion, Tata Motors remains committed to sustainable, advanced automotive solutions. Today, it stands as a dynamic leader in the global automotive industry, propelling India’s mobility sector through innovation, sustainability, and quality vehicles that address diverse market needs.
Industry Outlook
The automobile industry in FY25 and beyond is poised for significant growth, largely driven by the shift to electric vehicles (EVs), a surge in demand for SUVs, and continued growth in commercial vehicles (CVs). The transition to EVs is central to the industry’s future, supported by sustainability goals, regulatory incentives, and advancements in EV technology. Government support through tax incentives, subsidies, and charging infrastructure is expected to accelerate the adoption of EVs globally, with India benefiting from initiatives like the FAME II scheme. Tata Motors, already a leader in India’s EV market, is well-positioned to capitalize on this shift.
Meanwhile, the SUV segment is expected to maintain robust growth, with an anticipated 8% year-on-year increase in demand as consumers continue to prefer larger, more versatile vehicles. Tata Motors’ emphasis on popular SUVs like the Safari and Punch is well-aligned with this trend. Similarly, the commercial vehicle segment—especially in medium and heavy commercial vehicles (M&HCVs)—will continue to thrive, driven by growth in sectors such as logistics, e-commerce, and construction, where Tata Motors maintains a strong presence. The company is also tapping into new opportunities with CNG-powered M&HCVs, ensuring its leadership in this sector.
The recovery of global supply chains, which were disrupted by the pandemic and geopolitical tensions, is another key factor in the industry’s future growth. Challenges like semiconductor shortages and raw material price hikes continue to affect production, but supply chain resilience is improving. This will enable Tata Motors to ramp up production in FY25 and meet the increasing demand, especially as the luxury vehicle market continues to grow. However, the company faces challenges in key markets like China, which has impacted Jaguar Land Rover (JLR)‘s performance.
Tata Motors has strategically positioned itself as a leader in both the passenger and commercial vehicle segments, while also leading the EV revolution in India. The company has invested heavily in Tata Passenger Electric Mobility Limited (TPEML), which recently secured a ₹7,500 crore investment from TPG Rise Climate. This positions Tata Motors to take full advantage of the EV sector’s growth potential, even as subsidy phases out over time.
In the luxury vehicle space, JLR, while facing challenges such as supply chain disruptions and a slowing Chinese market, continues to focus on high-performance and premium electric models. The company’s outlook remains positive, with an £30 billion revenue target and an EBIT margin of over 8.5%. JLR is also prioritizing its “House of Brands” strategy, which will elevate its luxury image and increase demand for its halo products.
Tata Motors’ global expansion via acquisitions like Jaguar Land Rover has strengthened its presence across Europe, North America, Asia, and Africa. However, the company remains mindful of ongoing supply chain challenges, including disruptions such as flooding at the Nivelles facility. Despite these challenges, Tata Motors is focused on building supply chain resilience to adapt to the evolving global market.
The broader automobile sector is recovering as consumer confidence returns post-pandemic. In both developed and emerging markets like India, vehicle demand is expected to rise, with the festive season traditionally boosting retail sales. Government policies and incentives will continue to drive the demand for sustainable mobility, particularly for energy-efficient vehicles, providing Tata Motors with an ideal environment for growth in FY25 and beyond.
Looking ahead, Tata Motors is focusing on consistent, cash-generating growth across its segments. In the commercial vehicle (CV) segment, Tata Motors aims to increase market share and improve realizations by focusing on innovation, service quality, and brand activation. In the passenger vehicle (PV) segment, the company will drive retail growth with new model launches, strengthen its dealer network, and focus on cost reduction to improve profitability in a competitive environment. For EVs, Tata will continue to mainstream EV adoption through targeted market development and ecosystem support, ensuring scalable profitability. The company’s goal is to enhance its position as a leader in the growing EV market and ultimately become net debt-free.
Business Segments
Tata Motors operates in several core business segments:
Passenger Vehicles (PV): The Passenger Vehicles (PV) segment at Tata Motors includes various passenger cars and utility vehicles, with a strong presence in India’s electric vehicle (EV) market, driven by models like the Nexon EV. Tata PV reported revenue of ₹11,700 crores in Q2 FY25, showing a 3.9% YoY decline, and ₹23,500 crores in H1 FY25, down 5.9% YoY. EBITDA margin for Q2 was at 6.2%, with the ICE segment at 8.5%, while the EV business posted a negative EBITDA but turned positive when excluding development expenses. Tata leads the EV market with a 67% share, supported by new launches like the Curvv and Nexon variants. Moving forward, Tata PV aims to drive retail growth with new model launches, inventory management, and a multi-powertrain strategy to stay competitive in this dynamic market.
Commercial Vehicles (CV): Tata Motors is a leading player in India’s commercial vehicle (CV) market, manufacturing a diverse lineup of trucks, buses, and light commercial vehicles that serve sectors such as logistics, mining, and construction. In Q2 FY25, the CV segment recorded revenue of ₹17,300 crores, marking a 13.9% YoY decline; for H1 FY25, revenue totalled ₹35,100 crores, down 5.2% YoY. Profitability improved slightly, with an EBITDA margin of 10.8% and a PBT of ₹1,300 crores. However, CV volumes dropped by 19.6% to 79,800 units, impacted by slower infrastructure project execution, reduced mining activity, and heavy rains. Growth in specific sub-segments, such as EV buses and ACE EV vehicles, along with orders from government entities, is expected to support a demand recovery. Tata Motors projects a gradual demand increase in H2 FY25, driven by infrastructure investments and festive season consumption.
Jaguar Land Rover (JLR): Jaguar Land Rover (JLR), acquired by Tata Motors in 2008, forms the luxury vehicle segment of the company with its renowned Jaguar and Land Rover brands. Aligning with sustainable mobility trends, JLR is actively expanding its EV and hybrid vehicle offerings. The segment reported revenue of approximately ₹65,000 crores in Q2 FY25, a 5.6% YoY decline. H1 FY25 revenue remained stable at around ₹1,37,000 crores. Profitability faced challenges this quarter, as EBITDA margin dropped to 11.7% (a decrease of 320 basis points), and EBIT stood at 5.1% (down by 220 basis points). Q2 PBT was approximately ₹3,980 crores, while H1 PBT grew 25% YoY, reaching around ₹10,910 crores. Temporary factors, including an aluminium supply shortage and quality checks on over 6,000 vehicles, impacted overall performance. However, production is expected to rebound in H2 FY25. Significant EV production investments have generated high interest, particularly in the new Range Rover Electric and upcoming Jaguar EV models. On the financial side, JLR maintained a liquidity position of ₹49,000 crores, including a recently refinanced revolving credit facility of ₹16,000 crores. These investments and liquidity measures are expected to support JLR’s continued innovation and growth in sustainable luxury vehicles.
Electric Mobility: As part of its sustainable strategy, Tata Motors is actively developing electric vehicle solutions across passenger and commercial segments. The company aims to expand EV adoption in India through its dedicated EV division, Tata Passenger Electric Mobility Limited.
Tata Motors Finance (TMF): Tata Motors Finance is the financial services arm of Tata Motors, offering vehicle financing and insurance services, mainly to support its PV and CV segments.
These segments collectively support Tata Motors’ mission to provide a range of mobility solutions and remain competitive in both domestic and international markets.
Key Subsidiaries and Their Information
Tata Motors’ key subsidiaries are driving growth and innovation across various automotive segments. Below are some of the key subsidiaries and their info:
Jaguar Land Rover (JLR): This luxury automotive subsidiary continues to lead Tata Motors’ global presence. JLR has seen strong revenue performance, especially in the North American and European markets. They are focusing on electric vehicles (EVs) with a mix of high-end offerings like the Range Rover and Defender, helping drive up retail and wholesale volumes. JLR also continues to improve profitability and reduce net debt.
Tata Passenger Electric Mobility Ltd (TPEML): Tata’s EV subsidiary is pivotal to its strategy for growth in the electric vehicle sector. With significant investment from TPG Rise Climate, TPEML is positioned to capture the growing demand for electric cars in India. The company’s EV portfolio includes models like the Tigor EV, Tiago EV, and Ace EV.
Tata Commercial Vehicles (CV): This arm focuses on strengthening Tata Motors’ leadership in the commercial vehicle market, especially in medium and heavy trucks. With innovations in CNG-powered vehicles and a strong presence in sectors like logistics and e-commerce, Tata CV is well-positioned to benefit from India’s infrastructure development.
Tata Technologies Ltd: A global leader in engineering and design services, Tata Technologies supports Tata Motors with advanced technologies and innovation, particularly in the development of electric vehicles and enhancing product offerings
Tata Motors’ key subsidiaries play a crucial role in driving the company’s strategy, focusing on growth in electric mobility, enhancing its luxury brands, and expanding its commercial vehicle sector. Tata Motors also strengthens its presence in key global markets like Europe, North America, and Africa through joint ventures and strategic partnerships. These efforts are aligned with Tata Motors’ broader strategy to lead in electric mobility, luxury vehicles, and the commercial vehicle market
Q2 FY25 Highlights
Tata Motors (TML) delivered a revenue of ₹101,500 crores for Q2 FY25, which marks a 3.5% decline YoY. The EBITDA was ₹11,600 crores, translating to a margin of 11.4%, which is a 230 basis points (bps) decrease compared to the previous year. EBIT was reported at ₹5,600 crores (5.6% margin), a 190 bps decrease YoY.
The PBT (before exceptional items) for Q2 stood at ₹5,800 crores, down ₹391 crores, and the net profit for the quarter was ₹3,500 crores. However, the company posted a strong performance in H1 FY25, with a PBT (bei) of ₹14,600 crores, reflecting an improvement of ₹2,900 crores compared to the previous year.
For Jaguar Land Rover (JLR), the revenue was down 5.6% YoY to £6.5 billion (approximately ₹62,500 crores based on current exchange rates). JLR’s performance was impacted by temporary supply constraints, resulting in a 220 bps drop in EBIT margin to 5.1%.
Tata Motors’ Commercial Vehicle (CV) revenues declined by 13.9%, but the EBITDA margin improved to 10.8% (up 40 bps) due to favorable pricing and material cost savings.
The Passenger Vehicle (PV) segment experienced a 3.9% revenue decline, but the EBITDA margin remained steady at 6.2% (down 30 bps) thanks to mix improvements and cost reduction efforts.
The company introduced the Nexon ICNG and 45 kWh models, which have received strong market reception. A groundbreaking ceremony for a new plant in Chennai highlights Tata’s ongoing commitment to expanding production capabilities.
The company is advancing toward its decarbonization roadmap, targeting net carbon zero by 2039 and ensuring a BEV derivative for all its brands by 2030.
Tata Motors maintains its leadership in the electric vehicle (EV) segment, with a dominant 67% market share in the personal EV segment.
Tata Motors Ltd. faced a challenging quarter, with a 3.5% decline in revenue, largely driven by supply chain disruptions and reduced demand across segments. The company also experienced challenges in its Jaguar Land Rover (JLR) division, where a flood at a key supplier led to production constraints, affecting the production of 86,000 units. Additionally, EBIT margins were impacted due to higher DNA charges and increased sales support expenses.
In the Chinese market, industry-wide discounting and overstocking created difficulties for Tata Motors, resulting in strained dealer networks and reduced sales.
The company’s commercial vehicle (CV) volumes declined by 19% year-on-year, influenced by external factors such as higher interest rates and reduced mining activities, which slowed demand for heavy vehicles.
Financial Summary
INR in Cr.
Q2FY25
Q1FY25
Q2FY24
Q-o-Q(%)
Y-o-Y(%)
Revenue from Operations
1,01,450
1,08,048
1,05,129
-6.1%
-3.5%
Other Income
1,566
1,575
1,630
-0.6%
-3.9%
Total Income
1,03,016
1,09,623
1,06,759
-6.0%
-3.5%
Expenses
89,291
92,263
91,362
-3.2%
-2.3%
Operating Profit
12,159
15,785
13,767
-23.0%
-11.7%
OPM (%)
12%
15%
13%
-20.0%
-7.7%
Finance Cost
2,034
2,088
2,652
-2.6%
-23.3%
Depreciation and Amortisation Expenses
6,005
6,574
6,637
-8.7%
-9.5%
Profit Before Tax (PBT)
5,767
8,870
6,035
-35.0%
-4.4%
Profit After Tax (PAT)
3,450
5,692
3,832
-39.4%
-10.0%
EPS
9.72
14.51
9.81
-33.0%
-0.9%
SWOT Analysis of Tata Motors
Strengths:
Strong Brand Portfolio & Market Position – Well-established reputation with a broad customer base.
Comprehensive EV Strategy – Aggressive push into the electric vehicle (EV) market, positioning for future growth.
Global Presence – Operating in diverse international markets, reducing reliance on any single region.
Diverse Product Portfolio – Wide range of vehicles, including passenger cars, commercial vehicles, and electric models.
Weaknesses:
Dependence on Jaguar Land Rover (JLR) – Heavy reliance on the performance of its premium brand division.
Impact of Supply Chain Disruptions – Ongoing challenges in sourcing components, particularly semiconductor shortages.
Profitability Pressures – High operating costs and fluctuating demand affect overall profitability.
Opportunities:
Expansion in the Electric Vehicle (EV) Market – Growing demand for EVs presents opportunities for further market share in the green vehicle segment.
Growth in Commercial Vehicle Market – Increasing demand for commercial vehicles, especially in emerging markets.
Global Expansion of JLR – Potential for continued growth through international markets and new model launches.
Government Support for EVs & Green Technologies – Favorable policies and incentives promoting the shift to sustainable transportation.
Threats:
Geopolitical & Economic Instability – Ongoing global uncertainty can affect operations and demand in key markets.
Intense Competition in EV & Commercial Vehicle Segments – Rising competition from both traditional automakers and new EV startups.
Declining Demand in Key Markets – Weakening demand in mature markets such as Europe and India could impact growth.
Supply Chain Vulnerabilities – Ongoing disruptions in global supply chains, particularly in sourcing critical components.
Oil India Ltd. (OIL) is one of the largest national oil and gas companies in India, primarily engaged in the exploration, development, and production of crude oil, natural gas, and liquefied petroleum gas (LPG). Founded in 1959 and headquartered in Duliajan, Assam, the company plays a crucial role in securing India’s energy needs through its significant contributions to domestic oil and gas production. It operates under the Ministry of Petroleum and Natural Gas and has international interests as well. OIL operates a large network of pipelines, including a 1,157-km trunk pipeline in the North East, which transports crude oil from Assam to various refineries. The company has reserves and production blocks across India, as well as strategic international assets in locations like Russia, Mozambique, and the United States.
Industry Outlook
The Indian oil and gas industry is poised for robust growth, fuelled by rising energy demands, government initiatives for energy security, and ongoing reforms aimed at modernising the sector. With India being one of the largest consumers of oil globally, the industry is a critical part of the country’s energy landscape. The country’s oil demand is projected to double by 2040, and natural gas demand is expected to grow by 4-5% annually over the next decade. The government’s target to reduce oil import dependence by 10% by 2022 and achieve 15% natural gas share in the energy mix by 2030 underscores the importance of boosting domestic production.
Business Mix
Crude Oil: The company has continued to improve its crude oil production, which is higher by 4.79% in quarter ended 30 September 2024, at 0.875 MMT from 0.835 MMT in the quarter ended 30 September 2023. Crude oil production has increased by 5.5% in half year ended 30 2024 at 1.746 MMT from 1.655 MMT in the half year ended 2023.
Natural Gas: The sale of natural gas during FY 2023-24 was 2521 MMSCM as compared to 2507 MMSCM during the previous year. The nation’s commitment is to increase the share of natural gas in the energy basket from the current level of 6% to 15% by 2030.
LPG: LPG Filling Plant was in operation for 292 days. Revenue earned by selling LPG during FY 2023-24 was ₹ 170.40 crores. Net realisation of condensate was ₹ 34.13 crores in the FY 2023–24 as against ` 52.15 crore in the previous year.
Pipeline: The crude oil pipeline transported 6.74 MMT of crude oil as against 6.79 MMT in the previous year. The company operates a total network of 1,243 km of crude oil pipeline.
Quarterly Highlights
Revenue of ₹7247 crore in Q2 FY25 is down by 3.33% YoY from ₹7497 crore in Q2 FY24.
EBITDA of ₹2536 crore in this quarter at a margin of 35% compared to 46% in Q2 FY24.
Profit of ₹2069 crore in this quarter compared to₹640 crore in Q2 FY24.
Business Highlights
Average crude oil price realization for Q2 FY25 is $79.33 per barrel and $86.86 per barrel for Q2 FY24, decreased by 8.67%.
Out of ₹28,000 crore capex, ₹1400 crore is for E&P business, and NRL has debt of ₹11,500 crore.
For City Gas Distribution (CGD) bids won for 9 areas and functioning are Kolhapur, Ambala, and Kurukshetra.
From April 2025, we will be getting a $0.25 premium over. So it would be averaging $6.75 this coming April.
Phase 1 for DNPL is adding 55 kilometres of new capacity, and after achieving it, Phase 2 will begin.
SWOT Analysis
Strengths:
Extensive Domestic Market Presence
Strong Government Backing
Well-Established Pipeline Infrastructure
Weaknesses:
Heavy Reliance on Crude Oil Prices
Outdated Infrastructure in Key Areas
High Operational Costs
Opportunities:
Rising Demand for Natural Gas
Expansions in Renewable Energy Initiatives
Supportive Government Policies
Potential for Strategic International Partnerships
State Bank of India (SBI), incorporated on July 1, 1955, emerged following the nationalization of the Imperial Bank of India, with the Reserve Bank of India acquiring a 60% stake. SBI is a leading Indian multinational bank, headquartered in Mumbai, offering a broad array of financial services to individual, corporate, and institutional clients. Its extensive network is structured into four primary segments: Treasury, Corporate/Wholesale Banking, Retail Banking, and Other Banking Business. Through these, SBI provides personal banking, investment portfolios, and corporate banking services.
SBI operates one of the largest banking networks in India, with over 22,000 branches and a substantial overseas presence with 227 offices across 30 countries. Its international operations support global financial transactions from key cities like New York, Tokyo, and London. SBI also led in online initiatives, including SBI e-tax for digital tax payments, and expanded its digital footprint with innovative offerings like the SBI Virtual Debit Card for enhanced online security.
Through the years, SBI has grown through the acquisition and merger of associate banks and partnerships. Notably, in 2017, SBIabsorbed five associate banks and the Bharatiya Mahila Bank, making it one of the largest global banking networks. Internationally, SBI has established joint ventures, such as the Payments Bank with Reliance Industries and collaborations with Visa and Elavon for merchant acquiring businesses.
In addition, SBI’s insurance arm, SBI Life Insurance Company, is a joint venture with Cardif S.A., and its asset management subsidiary, SBI Funds, earned the title of ‘Mutual Fund of the Year’. Domestically, SBI supports government initiatives with specialized products like the Defence Salary Package and loans for senior citizens. Its technology-driven offerings serve to enhance customer experience across both urban and rural areas.
Industry Outlook
Based on the recent financial results and statements from the chairman of State Bank of India (SBI), the industry outlook for FY25 and beyond appears positive, with several key factors contributing to growth and stability. Global growth is expected to remain stable, with the US economy showing a positive outlook, which may lead to lower taxes and favorable regulations that could benefit the Indian economy, particularly in manufacturing and strategic alliances. Additionally, a positive shift in the geopolitical situation could help lower commodity prices, benefiting India and other economies globally. India continues to be the fastest-growing large economy, with a 6.7% GDP growth in Q1 FY25, supported by private consumption, investment, and agriculture, as well as strong demand expected during the festival season.
For the banking sector, scheduled commercial banks, including SBI, are expected to see deposit growth of 11-12% and credit growth of 12-13% in FY25, with a positive deposit credit differential, which signals a healthy banking environment. The Reserve Bank of India (RBI) is maintaining comfortable system liquidity, which is helping support stable credit growth in the sector.
SBI itself has crossed a significant milestone, with deposits reaching ₹51.17 trillion, reflecting steady growth in its CASA deposits, which remains a strong aspect of the bank’s financial performance. Credit growth for SBI is up by 14.93% year-on-year, driven by strong performance across corporate, retail, agriculture, and MSME sectors, positioning the bank for continued market leadership. Its asset quality remains strong, with a slippage ratio of 0.51% and a PCR of 75.6%, ensuring a well-provided loan book. The bank’s capital adequacy ratio is at a solid 13.76%, well above regulatory requirements, indicating sufficient capital to support growth.
SBI’s digital transformation is another key driver of its future growth. With over 8 crore customers on its digital platforms, the bank continues to innovate in digital banking, with 61% of regular savings accounts opened digitally in Q2 FY25. The bank is focused on expanding its digital channels and strengthening its branch networks to maintain its competitive edge in the market. Furthermore, SBI’s subsidiaries, including SBI Life Insurance and SBI Funds, continue to perform well and contribute significantly to the bank’s diversified revenue streams, ensuring long-term growth.
In conclusion, SBI’s strong financial performance, particularly in credit growth, robust deposits, and its focus on digital banking, positions the bank well to benefit from the positive outlook of the Indian economy and the overall banking sector. The bank’s commitment to sustainable growth and delivering superior shareholder value over the long term remains central to its strategic priorities.
Business Segments
State Bank of India (SBI) operates across several key business segments, each contributing significantly to the bank’s overall performance. Based on the Q2 FY25 results, here’s an analysis of these segments:
Treasury: This segment manages the bank’s investments and foreign exchange risks, as well as its bond holdings and market-based activities. The Q2 FY25 performance indicates favorable market conditions, contributing positively to the bank’s financial performance.
Corporate/Wholesale Banking: This segment serves large corporate and government clients, offering services like working capital finance and trade finance. In Q2 FY25, corporate advances saw an impressive 18.35% year-on-year growth, contributing to an overall credit growth of 14.93%. This indicates robust demand from the corporate sector.
Retail Banking: Serving individual customers, this segment focuses on products like personal loans, home loans, and savings accounts. The retail banking segment grew by 12.32% year-on-year in Q2 FY25, driven by demand for affordable housing and personal finance, supported by SBI’s extensive digital and physical network.
Other Banking Business: This includes wealth management, insurance, and asset management services. Subsidiaries like SBI Life Insurance and SBI Funds Management continue to perform well, contributing non-interest income and diversifying the bank’s revenue streams.
International Operations: SBI’s international segment, which covers over 30 countries, contributes through remittances, trade finance, and cross-border services. This segment grew by 11.56% year-on-year in Q2 FY25, reflecting the bank’s strong global presence.
SBI’s diversified operations across these segments, along with its focus on digital banking and strong capital base, position it well for continued leadership in the Indian banking sector.
Key Subsidiaries and Their Information
State Bank of India (SBI) has a diverse portfolio of subsidiaries, joint ventures, and associates that contribute significantly to its operations and financial performance. Below is an overview of some of the key subsidiaries and joint ventures, along with their insights:
SBI Life Insurance Company Ltd: As one of India’s largest private life insurance companies, SBI Life offers a broad range of products, including individual and group life insurance, pension plans, and health insurance. It continues to experience strong growth and holds a significant market share in the Indian life insurance industry. The company benefits from SBI’s vast customer base and extensive distribution network.
SBI General Insurance Company Ltd: This subsidiary focuses on general insurance, providing products like health, motor, travel, and home insurance. SBI General is rapidly expanding its reach across India, leveraging the bank’s nationwide distribution network to increase market penetration and cater to a broader customer base.
SBI Cards and Payment Services Limited: A leading player in the Indian credit card market, SBI Cards issues a wide range of cards catering to different customer segments. It continues to innovate in the digital payments space and has a strong presence in the Indian payments’ ecosystem, contributing to the broader digitalization trends in banking and finance.
SBI Capital Markets Ltd (SBICAP): As the investment banking arm of SBI, SBICAP offers services such as corporate advisory, capital markets, and investment banking. It is particularly known for its expertise in handling large IPOs, mergers and acquisitions, and other capital market activities, making it an important player in India’s financial services sector.
SBI Funds Management Ltd: SBI Funds is a major player in India’s mutual fund industry, managing a variety of mutual fund schemes for both retail and institutional clients. With its strong investment capabilities and a wide array of offerings, it plays a pivotal role in helping investors manage their portfolios.
SBI Payments Services Pvt Ltd: This subsidiary is instrumental in expanding SBI’s footprint in the digital payments landscape. It provides innovative payment solutions, including point-of-sale (POS) terminals, digital wallets, and online payment services, contributing to the bank’s leadership in India’s digital banking sector.
SBI Global Factors Ltd: SBI Global Factors offers factoring services primarily to small and medium-sized enterprises (SMEs), helping them improve their liquidity by allowing them to sell their receivables. This service is especially valuable for SMEs seeking to manage cash flow more effectively.
SBI Ventures Ltd: Formerly known as SBICAP Ventures, SBI Ventures focuses on investments in growth-stage companies, particularly in emerging sectors like technology and healthcare. Its venture capital activities align with SBI’s broader strategy to diversify beyond traditional banking and explore high-growth industries.
State Bank of India (UK) Limited: SBI UK provides a range of retail and corporate banking services in the UK. It supports the bank’s international growth by catering to both individual customers and businesses, particularly those with ties to India, enhancing SBI’s presence in the international banking sector.
SBI (Mauritius) Ltd: This subsidiary focuses on providing banking services in Mauritius, which acts as a gateway for SBI’s expansion into Africa. By offering a variety of financial services, SBI (Mauritius) plays an important role in strengthening the bank’s international portfolio and capitalizing on opportunities in the African market.
Each of these subsidiaries plays a key role in diversifying SBI’s business operations and bolstering its presence across multiple sectors such as insurance, payments, investment banking, and asset management. This diverse portfolio allows SBI to maintain its leadership in the Indian banking sector while also expanding globally.
Key Joint Ventures of SBI
SBI Macquarie Infrastructure Management Pvt. Ltd: A joint venture between SBI and Macquarie Group, this entity focuses on managing infrastructure investments in India, particularly in areas like roads, power, and utilities.
SBI Macquarie Infrastructure Trustee Pvt. Ltd: This joint venture manages infrastructure investment trusts, which help in raising capital for infrastructure projects across India.
Jio Payments Bank Ltd: A partnership between SBI and Reliance Jio, Jio Payments Bank aims to offer digital payment solutions and banking services to customers, especially in rural and semi-urban areas.
Oman India Joint Investment Fund – Management Co Pvt. Ltd: This JV focuses on managing investments in India, especially in sectors that attract foreign investments.
Key Associates of SBI
Andhra Pradesh Grameen Vikas Bank: This associate focuses on providing banking services to rural populations in Andhra Pradesh, particularly to promote financial inclusion.
Nepal SBI Bank Ltd: This associate operates in Nepal, providing a range of banking services to the growing market there.
Commercial Indo Bank LLC, Moscow: This associate bank serves Indian expatriates and businesses in Russia, helping them with banking and financial services.
Q2 FY25 Highlights
This Q2FY25 data indicates a solid performance with key highlights across profitability, business growth, asset quality, and digital leadership.
Profitability: The bank reported a Net Profit of ₹18,331 crores in Q2FY25, showing robust earnings. Return on Assets (ROA) was at 1.13% for H1FY25, and Return on Equity (ROE) was 21.78%, reflecting efficient use of equity capital. The Net Interest Margin (NIM) was 3.18% for the whole bank and slightly higher in domestic operations at 3.31%, which supports sustainable profitability.
Business Growth: The bank’s deposits crossed the ₹51 trillion mark, growing 9.13% YoY, while advances exceeded ₹39 trillion, with a strong 14.93% YoY growth in credit. This broad-based growth demonstrates expansion in both deposits and credit across market segments, positioning the bank for continued market share growth in a competitive environment.
Asset Quality: Improvements in asset quality are evident, with Gross NPA at 2.13% and Net NPA at 0.53%, reflecting strong risk management. The credit cost for H1FY25 was 0.43%, indicating reduced provisioning needs due to improved loan quality. The Provision Coverage Ratio (PCR) stands at 75.66%, and including AUCA (Accounts Under Collection Account), it reaches 92.21%, demonstrating conservative provisioning for stressed assets.
Well-Provided Stressed Book: Additional provisions of ₹31,084 crores are set aside, equating to 153% of Net NPAs, which adds a layer of resilience and minimizes potential future losses from non-performing assets.
Digital Leadership: Digital transformation is leading growth, with >98% of transactions occurring through alternate channels. The bank’s mobile app, YONO, has 8.13 crore registered users, reinforcing its digital-first strategy. Notably, 61% of savings accounts were opened via YONO in Q2FY25, underscoring its impact on customer acquisition and engagement.
The bank’s liability franchise benefits from brand trust and market share dominance (~22% in deposits), with a 10.05% YoY growth in current account balances. Its credit-to-deposit ratio at 67.87% indicates a healthy balance between deposit inflows and lending activities.
The Central Board has approved raising up to ₹20,000 crore in long-term bonds during FY25. These funds may be raised via public issue or private placement, providing the flexibility to select the best approach based on market conditions. The initiative aims to enhance the bank’s capital base, supporting business growth, credit expansion, and financial resilience. This capital boost aligns with the bank’s strategic goals of strengthening its capital structure and sustaining a healthy credit-to-deposit ratio for stable, long-term growth.
Financial Summary (Standalone)
Type
Q2FY25
Q1FY25
Q2FY24
Q-o-Q (%)
Y-o-Y (%)
Interest Income
1,13,871
1,11,526
1,01,379
2.1%
12.3%
Interest Expenses
72,251
70,401
61,879
2.6%
16.8%
Net Interest Income
41,620
41,125
39,500
1.2%
5.4%
Non-Interest Income
15,271
11,162
10,791
36.8%
41.5%
Operating Income
56,890
52,287
50,291
8.8%
13.1%
Interest on Deposits
63,201
60,340
54,474
4.7%
16.0%
Interest on Borrowings
5,829
7,211
4,594
-19.2%
26.9%
Other Interest paid
3,221
2,850
2,811
13.0%
14.6%
Total Interest Expenses
72,251
70,401
61,879
2.6%
16.8%
Salary
11,901
11,967
9,706
-0.6%
22.6%
Provisions for Employees
2,906
3,499
9,221
-16.9%
-68.5%
Staff Expenses
14,807
15,466
18,926
-4.3%
-21.8%
Overheads
12,789
10,373
11,948
23.3%
7.0%
Of which: Business Acquisition & Development Expenses
1,491
1,061
1,509
40.5%
-1.2%
Operating Expenses
27,596
25,839
30,874
6.8%
-10.6%
Total Expenses
99,847
96,239
92,753
3.7%
7.6%
Operating Profit
29,294
26,449
19,417
10.8%
50.9%
Total Provisions
10,962
9,413
5,087
16.5%
115.5%
Net Profit
18,331
17,035
14,330
7.6%
27.9%
NIM (Whole Bank) (%)
3.14
3.22
3.29
-2.5%
-4.6%
NIM (Domestic) (%)
3.27
3.35
3.43
-2.4%
-4.7%
Cost to Income Ratio (%)
48.51
49.42
61.39
-1.8%
-21.0%
Cost to Assets (%)
1.76
1.67
2.17
5.4%
-18.9%
Ratios (Annualized)
Q2FY25
Q1FY25
Q2FY24
ROA (%)
1.17
1.10
1.01
ROE (%)
20.98
Earning Per Share (₹)
81.49
76.56
63.88
SWOT Analysis
Strengths:
Market Leadership
Extensive Branch and ATM Network
Ongoing Digital Transformation
Strong Government Support and Diverse Product Portfolio
Raymond Lifestyle Limited, originally incorporated as “Ray Universal Trading Private Limited” on October 26, 2018, has evolved through several name changes. It became a public limited company on March 3, 2020, under the name “Ray Universal Trading Limited,” then rebranded as “Raymond Consumer Care Limited” on July 18, 2020. Finally, on May 2, 2024, it received a fresh certificate of incorporation, formally adopting the name “Raymond Lifestyle Limited.” Raymond Lifestyle is a leading India-based fashion and retail company specializing in textiles, branded suiting and shirting, and ready-to-wear clothing. Known for its extensive men’s fashion brands and retail network, the company has a diverse portfolio that includes formal, casual, and ethnic wear through brands like Raymond, Park Avenue, ColorPlus, Parx, and Ethnix by Raymond. The Composite Scheme of Amalgamation & Arrangement in 2024 further strengthened its position by demerging the Lifestyle Business Undertaking of Raymond Limited into Raymond Lifestyle Limited. Raymond Lifestyle operates across various business segments, including branded apparel, suiting, shirting, garmenting, and retail initiatives like The Raymond Shop, Raymond Made to Measure, Raymond Home, and Ethnix. With a fabric manufacturing capacity of around 43 million meters, the company produces high-quality fabrics from wool, poly-wool, silk, and other premium blends. The Ethnix by Raymond brand provides a curated collection of ready-made ensembles for festive and special occasions, while Raymond Made to Measure offers customized suits, formal jackets, and shirts. In addition, Raymond Home presents a range of contemporary home linens, including bedsheets, towels, and comforters, meeting modern decor needs.
Industry Outlook
India’s textiles sector is one of the oldest industries in the country, deeply rooted in agriculture for raw materials such as cotton, and it is an integral part of India’s cultural heritage. The sector offers a wide variety of fibers and yarns, from natural fibers like cotton, silk, and wool, to synthetic fibers such as polyester and nylon. The largest component of the industry consists of the decentralized power looms and knitting sector.
India ranks among the top five global exporters of textiles and apparel, contributing 2.3% to the GDP, 13% to industrial production, and 12% to exports. With approximately 45 million workers in the textile industry, including 3.5 million handloom workers, the sector plays a significant role in employment.
The Indian technical textiles market is expected to grow to US$ 23.3 billion by 2027, driven by rising consumer demand. India’s broader textile market, valued at US$ 223 billion in 2021, is projected to reach US$ 350 billion by 2030, fueled by increasing export growth and domestic demand. The Indian government has set ambitious targets, aiming for US$ 250 billion in textile production and US$ 100 billion in exports by 2030. This goal is part of the five-step strategy: “Farms to Fibre to Fabric to Fashion to Foreign export,” aimed at positioning India as a leading global textile brand.
The Indian apparel market, valued at INR 5.5 trillion, is projected to grow at a CAGR of ~18.2% from FY23 to FY27, reaching INR 10.7 trillion by FY27. Within this, men’s wear represents ~41% of the market, valued at ~INR 2.2 trillion in FY23, and is expected to grow at a ~18% CAGR to reach INR 4.3 trillion by FY27. Western wear dominates the men’s apparel segment, holding a ~94% share, while ethnic wear accounts for about 6%. The men’s western wear market is expected to grow at 18% CAGR, reaching INR 4.1 trillion by FY27.
The Indian wedding market is valued at INR 11 trillion, with clothing expenses making up approximately 23% of the total, which estimates the wedding clothing market at INR 2.5 trillion. Of this, men’s clothing represents 30%, valued at INR 750 billion, while women’s and children’s wear accounts for 70%. Raymond, with a strong presence in men’s wear, holds ~5% of the Indian men’s wedding wear market, where wedding wear contributes 35-40% to its business. Raymond Lifestyle Limited (RLL) aims to grow its market share to 6-7% in men’s wedding wear by 2027, with a 15% CAGR.
The ethnic wear market, an important part of the wedding wear segment, is valued at INR 1.6 trillion and is expected to grow at an 18% CAGR from FY24 to FY27. The men’s ethnic wear segment, valued at INR 140 billion in FY23, makes up about 9% of the total ethnic wear market, with organized players holding a 38% share. This share is expected to increase to 45% by FY27, benefiting brands like Raymond.
Business Segments
Raymond Lifestyle operates through five main segments, each playing a significant role in its market presence and brand portfolio. Here’s an overview of each segment:
Branded Textile: This segment is the core of Raymond’s traditional business, offering high-quality worsted fabrics primarily used in men’s suiting and shirting. Known for fine craftsmanship and premium quality, Raymond has built a strong brand reputation in India’s textile market. Branded textiles cater to both business-to-business (B2B) and business-to-consumer (B2C) markets, including custom tailoring and branded fabric sales through exclusive retail outlets. Revenue declined to Rs 854 crore in Q2 FY25 from Rs 933 crore in Q2 FY24, due to muted demand and the impact of “Shraadh.” EBITDA margin dropped to 18.9% from 22.2%.
Branded Apparel: This segment covers ready-to-wear clothing under Raymond’s well-known apparel brands: Raymond, Park Avenue, ColorPlus, and Parx. Each brand within this segment targets a distinct market: Park Avenue focuses on premium formal wear, ColorPlus emphasizes casual wear, and Parx targets youth-oriented casual fashion. Branded Apparel has a wide distribution network through Raymond’s exclusive brand outlets, franchise stores, and online channels, meeting the demands of the modern consumer. Revenue slightly increased to Rs 441 crore in Q2 FY25, up from Rs 437 crore in Q2 FY24, supported by new store additions. EBITDA margin improved to 13.0% from 12.2%, with 52 new stores added, expanding the retail network to 1,592 stores as of September 30, 2024.
Garmenting: The Garmenting segment caters to both domestic and international markets by manufacturing ready-made garments, with a focus on exports. It leverages Raymond’s expertise in high-quality tailoring, supplying suits, jackets, trousers, and shirts for global brands and private labels. This segment benefits from the “Bangladesh +1” and “China +1” trends, which encourage international companies to source from India, making Raymond a key player in global garment production. Revenue decreased to Rs 260 crore in Q2 FY25 from Rs 286 crore in Q2 FY24 due to logistical delays in shipments. The EBITDA margin stood at 9.6%.
High Value Cotton Shirting: This segment focuses on producing high-quality cotton shirting fabrics, a premium product in Raymond’s portfolio. Known for quality and durability, these cotton shirting fabrics serve both Raymond’s branded apparel lines and external clients. The segment’s products are popular in both domestic and export markets, supporting Raymond’s reputation for luxury textiles. Revenue rose by 8% to Rs 228 crore in Q2 FY25 from Rs 211 crore in Q2 FY24, fueled by B2B demand for the festive and wedding season. However, EBITDA margin decreased to 9.7% due to higher input costs.
Others: The “Others” category includes Raymond’s smaller but strategic ventures, such as accessories (ties, belts, and wallets) and Made-to-Measure (MTM) services, which allow customers to personalize garments for an exclusive fit and style. This category also encompasses Raymond’s high-value wool-based and specialty fabrics, catering to niche markets. Together, these additional offerings enhance the brand’s portfolio and provide customers with complete lifestyle solutions.
Key Subsidiaries and Their Information
Here is an overview of Raymond Lifestyle’s key subsidiaries and their primary functions:
Raymond Luxury Cottons Limited: Focuses on producing premium cotton fabrics, including high-quality cotton shirting and luxury fabrics. Known for its high-thread-count cotton, this subsidiary plays a key role in Raymond’s presence in the luxury fabric market.
Silver Spark Apparel Limited: Engages in garment manufacturing and is one of the primary exporters of suits, jackets, and trousers. Caters to both domestic and international markets, supplying ready-made garments to global brands and private labels.
R&A Logistics Inc.: Raymond’s logistics arm, managing supply chain and distribution to ensure smooth operations across international markets. Plays a critical role in optimizing the transportation and delivery of Raymond’s products to various destinations.
Silverspark Middle East FZE: Focuses on Raymond’s business expansion in the Middle Eastern market, managing regional sales and distribution. Helps to position Raymond as a premium brand in apparel and textiles across the Middle East.
Silver Spark Apparel Ethiopia PLC: A manufacturing unit based in Ethiopia, supporting Raymond’s global garment production, particularly for export markets. This facility enhances Raymond’s cost-effectiveness and competitiveness in global markets, contributing to the “Africa +1” manufacturing strategy.
Raymond America Apparel Inc.: Serves as Raymond’s business presence in the US, dealing with apparel imports, distribution, and sales in North America. It strengthens Raymond’s international retail and B2B partnerships within the American market.
Jaykayorg AG: Based in Switzerland, this subsidiary manages global investments and asset management for the Raymond Group. It plays a strategic role in financial operations and investment growth for Raymond internationally.
Celebrations Apparel Limited: Specializes in the manufacturing of celebration and formal wear, including high-end and occasion-specific garments. Supports Raymond’s position as a leader in India’s wedding and festive wear market, a significant growth area for the company.
Raymond (Europe) Limited: Raymond’s European subsidiary, managing sales and distribution across Europe, including both branded apparel and textiles. Helps to expand Raymond’s footprint in European markets, targeting high-fashion and luxury fabric segments.
Ray Global Consumer Products Limited: Focuses on consumer products outside of apparel, including personal care, grooming, and lifestyle products. Expands Raymond’s brand into non-apparel consumer goods, reinforcing its image as a comprehensive lifestyle brand.
Each of these subsidiaries contributes to Raymond’s growth and market expansion, allowing it to operate across diverse geographies and product segments effectively.
Q2 FY25 Highlights
In Q2 FY25, Raymond Lifestyle’s total income was ₹1,735 crore, marking a 6% YoY decline from ₹1,849 crore in Q2 FY24 but showing growth from ₹1,250 crore in Q1 FY25. For H1 FY25, total income dropped 7% YoY to ₹2,985 crore from ₹3,203 crore in H1 FY24.
Operating expenses (Opex) in Q2 FY25 were ₹1,494 crore, slightly down from ₹1,543 crore in Q2 FY24, and rose from ₹1,160 crore in Q1 FY25. H1 FY25 Opex totaled ₹2,654 crore, compared to ₹2,718 crore in H1 FY24.
EBITDA was ₹242 crore in Q2 FY25, down 21% YoY from ₹306 crore in Q2 FY24 but up from ₹89 crore in Q1 FY25. For H1 FY25, EBITDA was ₹331 crore, a 32% YoY decline from ₹486 crore. The EBITDA margin in Q2 FY25 was 13.9%, down from 16.6% YoY but a notable improvement from 7.1% in Q1 FY25.
Profit Before Tax (PBT) dropped 45% YoY to ₹112 crore in Q2 FY25 from ₹203 crore in Q2 FY24, but this was a recovery from a ₹32 crore loss in Q1 FY25. PBT margin in Q2 FY25 was 6.5%, down from 11.0% YoY, but improved from -2.5% in Q1 FY25. H1 FY25 PBT was ₹80 crore, down 70% YoY from ₹264 crore.
Net Profit in Q2 FY25 reached ₹102 crore, a recovery from a ₹23 crore loss in Q1 FY25. However, after exceptional items, Q2 FY25 net profit stood at ₹42 crore, down from ₹139 crore in Q2 FY24. For H1 FY25, net profit after exceptional items was ₹19 crore, compared to ₹188 crore in H1 FY24, reflecting the impact of lower revenue and margin challenges over the period.
Raymond Lifestyle has demonstrated resilience in a challenging retail environment. The company’s focus on retail expansion, new product launches, and strategic marketing positions it to capitalize on the upcoming festive demand in India.
The operating highlights include the opening of 52 new stores, signaling a strong expansion of market presence. Customer acquisition efforts are ongoing, focusing on attracting and retaining a growing customer base. Additionally, the brand has expanded its product offerings with the introduction of a new sleepwear line, broadening its appeal and catering to customer demand for diverse products.
The economy and market updates indicate subdued consumer demand, with discretionary spending impacted primarily by inflation. Geopolitical tensions and persistently high inflation remain significant risks in international markets. Additionally, there was a lower offtake in September due to the ‘Shraadh’ period and ongoing muted consumer demand. Meanwhile, the Bangladesh +1 strategy is showing promise, as it has started receiving enquiries in the garmenting business.
