Here are the highlights from the Q4 FY25 earnings conference call of Electronic Smart India Limited:

1. Financial Performance:

• Revenue for FY25 reached ₹6,965 crores, an 11% increase from FY24.
• EBITDA for FY25 was ₹451 crores, with EBITDA margins at 6.5%.
• For Q4 FY25, revenue was ₹1,719 crores, a 13% year-on-year growth.
• PAT for FY25 was ₹161 crores, down from ₹184 crores in the previous year.

1. Store Expansion:

• The company added 44 new stores during FY25, reaching a total of 200 stores.
• New stores are primarily located in Telangana, Andhra Pradesh, and the National Capital Region (NCR).
• Plans to open an additional 25 to 30 stores in FY26.

1. Category Performance:

• Large appliances were the biggest revenue driver, contributing 45.4% to total revenue with a 12% year-on-year growth.
• Mobile phones contributed 42% to total revenue, with stable growth at around 11%.

1. Market Outlook:

• India’s GDP growth is projected between 6.2% to 6.8% for the upcoming fiscal year, supported by government spending and increased consumer financing.
• The union budget of 2025 is expected to boost consumer spending due to personal income tax relief.

1. Challenges and Strategies:

• The expansion of new stores has led to higher operating costs, impacting profitability in the short term.
• The company is focused on optimizing supply chain operations and improving inventory management.
• Anticipates gradual improvement in throughput and contribution from new stores as they stabilize.

1. Regional Insights:

• Hyderabad’s performance has been flattish, but recent quarters showed a positive trend with a 4% growth in Q4.
• The NCR region is expected to break even soon, with plans for further store additions.

1. Inventory Management:

• Current inventory levels are in line with expectations, with no significant stress anticipated.
• The company does not foresee the need for additional discounting to liquidate inventory.

1. Capex and Debt:

• Capex for FY25 was approximately ₹350 crores, with a significant portion allocated to property purchases.
• Current debt levels are around ₹983 crores, with a focus on managing working capital effectively.

1. Future Expectations:

• The company expects to see improvements in margins and profitability as new stores mature and contribute to revenue.
• Anticipates a positive outlook for the upcoming fiscal year, driven by strategic expansions and market conditions.

1. Q&A Session:
   • Participants raised questions regarding regional performance, inventory management, and the impact of government regulations on retail expansion.

Overall, the management expressed optimism about long-term growth despite short-term challenges, emphasizing strategic investments and market opportunities.

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