Redington Ltd – ₹1 Lakh Crore Sales, 2% Margins: The FMCG of IT Distribution
1. At a Glance
Redington is the guy at every party who knows a guy. Want an iPhone? HP printer? Dell server? Solar panel? Even a mosquito coil of cloud services? Redington doesn’t make them, but they’ll deliver them faster than your Zomato order. With ₹1,04,000 crore sales in FY25 and net profit margins thinner than papad (1.3%), the company proves that you can be India’s 2nd largest distributor and still survive on commission money.
2. Introduction
Born in 1993, Redington has grown from a Chennai back-office distributor to a board-run, promoter-less behemoth with presence in 32 countries. It’s like your friendly neighborhood middleman, but with 200+ warehouses, 450 brand tie-ups, and the power to move Apple products at scale.
The irony? Despite handling iPhones, Redington trades like a feature phone stock – low P/E, 2.8% dividend yield, and no glamorous startup vibes. Investors don’t drool over it like Zomato or Nykaa, but quietly, it has been compounding at 16% sales CAGR for a decade.
The business model is simple – procure, distribute, service, and repeat. Except when the government suddenly decides to restrict laptop imports (Nov 2023), or when your Turkish subsidiary makes you take $8 million in provisions. That’s the life of a distributor: always running, rarely celebrated.
But hey, in the supply chain Olympics, Redington is gunning for top 5 globally. The question is – can a margin-thin distributor really compete with giants, or is this just another “Chennai boys vs Silicon Valley” story?
3. Business Model – WTF Do They Even Do?
Imagine Flipkart B2B, but for the world. Redington doesn’t create products; it’s the “tiffin service” of IT.
ESG (36.6%): End-point – PCs, printers, toners. Basically, the boring IT equipment your office IT guy orders.
TSG (30%): Servers, networking, storage. The backbone of data centers. If ChatGPT is running, chances are Redington delivered the servers.
MSG (34.3%): Smartphones. Apple alone is 29% of revenue. Without iPhones, Redington would be just “Tington.”
CSG (4.1%): Cloud solutions resale. Like being AWS’s reseller. Middleman 2.0.
Renewable Energy (0.2%): Solar panels. Green dreams, red margins.
Logistics & Services (2.3%): ProConnect, Ensure, Paynet. Side hustles, though Paynet was sold for $87M in 2024.
So yeah, WTF do they do? They buy from Apple, HP, Lenovo, Dell, Samsung, and re-sell to 2 lakh resellers. The business is volume ka baap, margin ka anath.
4. Financials Overview
Metric
Latest Qtr (Jun’25)
YoY Qtr (Jun’24)
Prev Qtr (Mar’25)
YoY %
QoQ %
Revenue (₹ Cr)
25,952
24,896
26,440
+4.2%
-1.8%
EBITDA (₹ Cr)
400
458
597
-12.7%
-33.0%
PAT (₹ Cr)
233
283
918*
-17.7%
-74.6%
EPS (₹)
3.52
3.75
8.51*
-6.1%
-58.6%
*Mar’25 PAT included ₹626 Cr exceptional gain from Paynet divestment.
Commentary: Core PAT is flat, but one-time gains made FY25 look like a jackpot. Strip that, and margins are thinner than a samosa sheet.
5. Valuation – Fair Value Range Only
P/E Method TTM EPS = ₹20.9 Industry P/E = 38 Fair Range = 15x–20x = ₹314 – ₹418
