- Opening HookWhile most IT distributors are still stuck selling cables, Redington’s management sounds like they’re pitching a SaaS startup. The Chennai-based distributor flexed its best-ever quarter—INR 29,118 crore revenue and INR 388 crore profit—without any Excel acrobatics. CEO Hariharan proudly announced that even the AI PCs were refreshing faster than India’s economy. But hold that applause—Turkey’s Arena subsidiary is still bleeding lira and patience.Keep reading, because this call had everything—AI PCs, hyperscalers, cloud dreams, and dividend philosophy debates. It gets spicy.
- At a Glance
- Revenue up 17%:Management swears it’s “profitable growth,” not just AI buzzword inflation.
- PAT margin at 1.33%:Margins so thin, you could print them on a SIM card.
- Mobility grew 18%:iPhones and Androids finally agree on one thing—boosting Redington.
- SSG up 48%:Cloud, cybersecurity, software—the holy trinity of recurring revenue nirvana.
- Arena loss INR 37 crore:Turkey’s economy and Redington’s patience, both tested.
- Working capital days down to 31:CFO flexed efficiency like it’s a fitness tracker stat.
- Management’s Key Commentary
“This has been our best quarter ever with revenue of INR 29,118 crore.”(Translation: We’re officially too big to blame Excel errors for missed targets.😏)
“Software Solutions Group grew 48%, contributing 16% of topline.”(Translation: Finally, a segment that doesn’t rely on customs clearance speed.)
“AI PC penetration is rising; 22% of commercial PCs sold were AI-classified.”(Translation: Just slapping ‘AI’ on the box boosts demand.)
“Working capital days dropped to 31.”(Translation: Suppliers finally stopped ghosting on payments.)
“Arena continues to face macroeconomic headwinds in Turkey.”(Translation: Turkey remains a masterclass in how to turn profits into interest payments.)
“We’re investing in Redington Academy and CloudQuarks digital platform.”(Translation: HR training + buzzword platform = investor-friendly PowerPoint slide.)
“VAR India named us #1 IT distributor in India.”(Translation: Bragging rights achieved; now we’ll print it on mugs.☕)
- Numbers Decoded
| Metric | Q2 FY26 | YoY Growth | Commentary |
|---|---|---|---|
| Revenue | ₹29,118 Cr | +17% | Record-breaking, driven by Mobility & SSG |
| PAT | ₹388 Cr | +? | Highest-ever Q2 profit |
| PAT Margin | 1.33% (1.57% ex-Arena) | Flatish | Arena still dragging the mood |
| Working Capital Days | 31 | Improved | CFO’s caffeine levels up, cash cycle down |
| Arena Loss (Redington share) | ₹37 Cr | – | Lira hangover continues |
| Factoring Cost | ₹45 Cr | +37% YoY | Turkey’s interest rate: the true villain |
| SSG Growth | +48% | Accelerated | Cloud + Cybersecurity = Cash Cloud |
| Mobility Growth | +18% | Strong | Premium phones and direct-to-retail magic |
(Arena finally selling assets instead of excuses.)
- Analyst Questions
- Investec:“How different is SSG’s working capital profile?”CFO:“Almost similar to company average.”(Translation: We’re too early to claim it’s asset-light, but sounds better if we say so.)
- Unifi Capital:“When do Arena losses stop?”CFO:“By Q4 or next year.”(Translation: Turkey’s ‘light at the end of tunnel’ is still flickering.)
- Unique PMS:“Dividend payout too high?”CEO:“We’ll discuss with Board.”(Translation: Yes, but we like looking generous.😏)
- Guidance & OutlookManagement painted a sunny sky over most geographies: India, UAE, and Saudi Arabia all showing strong momentum. SSG expected to grow 30–50% annually, fueled
