🧭 1. At a Glance
Electronics Mart India Ltd (NSE: EMIL) is the 4th largest consumer durables retailer in India and the undisputed No. 1 in Andhra Pradesh and Telangana. It sells 6,000+ SKUs from over 70 brands via its “Bajaj Electronics” stores. Revenue has jumped from ₹5,446 Cr in FY23 to ₹6,965 Cr in FY25—but stock is down 38% in 1 year, and profits have declined YoY. Why? Margins under pressure, interest costs rising, and a valuation correction long overdue.
🎬 2. Introduction – “India’s Croma, Without the Hype”
If Croma had a cousin in South India who actually made money and wasn’t run by a salt-to-software empire, it would be EMIL.
✅ Dominant in South India
✅ No-frills retail chain
✅ 146 stores and counting
✅ Focused on white goods, mobiles, and IT
Sounds great? Here’s the twist:
Margins are wafer-thin, cash flows are volatile, debt keeps rising, and despite all the expansion, net profit in FY25 declined.
⚙️ 3. WTF Do They Even Do?
Electronics Mart is a consumer durables retail chain. Think:
- White Goods: ACs, fridges, washing machines
- Mobiles + IT: Laptops, smartphones
- Small appliances + kitchen stuff: Mixers, chimneys, and Insta-worthy OTGs
- 70+ brands: Samsung, LG, Whirlpool, Xiaomi, OnePlus, etc.
Revenue split (approx.):
- 50% Large Appliances
- 25% Mobiles
- 25% Small Appliances & IT
Their business model is low-margin, high-volume, and heavily reliant on footfall + seasonal surges.
📊 4. Financials – Growing Topline, Shrinking Bottomline
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| 💰 Revenue (₹ Cr) | 5,446 | 6,285 | 6,965 |
| 🧾 Net Profit (₹ Cr) | 123 | 184 | 160 |
| 🧨 EBITDA Margin (%) | 6% | 7% | 6% |
| 🏦 ROCE (%) | 12% | 13% | 10% |
| 📉 EPS (₹) | 3.19 | 4.78 | 4.16 |
📉 TTM PAT Growth: -13%
📉 OPM Drop: 7% → 6%
📈 Sales up, but profitability down
💸 5. Valuation – Is It Cheap, Meh, or Crack?
| Metric | Value |
|---|---|
| P/E | 34.6x |
| P/B | 3.62x |
| Market Cap | ₹5,546 Cr |
| EV/EBITDA | ~13x (est.) |
| ROE | 11.0% |
🧮 Fair Value Range:
- FY26E PAT: ₹180–200 Cr
- Fair P/E Range: 20–25x
- Market Cap FV: ₹3,600–₹5,000 Cr
- FV/Share Range: ₹95–₹132
⚠️ CMP ₹144 is slightly above conservative FV
🍿 6. What’s Cooking – News, Triggers, Drama
- 🏬 New store launches: Delhi (July), Vijayawada (June) – expanding footprint outside core South India
- 📉 Stock is down 38% in 1 year
- 🧯 PAT has declined YoY despite store additions
- 🔄 FIIs & DIIs holding steady, while public shareholding rose in Q1FY26
- 📊 No dividend policy yet – despite being profitable for years
🏦 7. Balance Sheet – How Much Debt, How Many Dreams?
| Item | FY25 |
|---|---|
| Equity Capital | ₹385 Cr |
| Reserves | ₹1,146 Cr |
| Borrowings | ₹1,976 Cr |
| Total Liabilities | ₹3,697 Cr |
| Fixed Assets + CWIP | ₹1,788 Cr |
⚠️ Debt/Equity is over 1.4x
⚠️ Debt has nearly doubled in 3 years
💡 Expansion funded largely by debt → risk of margin pressure during slowdowns
💵 8. Cash Flow – Sab Number Game Hai
| Year | CFO (₹ Cr) | FCF (est.) |
|---|---|---|
| FY23 | -₹1 Cr | Negative |
| FY24 | ₹160 Cr | Positive |
| FY25 | ₹176 Cr | Moderate |
But…
- Capex in FY25 = ₹332 Cr
- Net Cash Flow = -₹55 Cr
- Working capital days: 81
They’re expanding using borrowed funds + operating cash, not free cash. Not ideal.
📐 9. Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| OPM | 6% |
| ROCE | 10.3% |
| ROE | 11.0% |
| Inventory Days | 76 |
| Debtor Days | 9 |
| Payable Days | 6 |
| Cash Conversion Cycle | 79 |
✅ Clean receivables
❌ Inventory-heavy
❌ Low margin, moderate returns business
💼 10. P&L Breakdown – Show Me the Money
| Quarter | Revenue (₹ Cr) | PAT (₹ Cr) | OPM (%) |
|---|---|---|---|
| Q1FY25 | 1,975 | 72 | 8% |
| Q2FY25 | 1,386 | 25 | 6% |
| Q3FY25 | 1,885 | 32 | 5% |
| Q4FY25 | 1,719 | 31 | 7% |
Sales per quarter are volatile, and so is PAT
They do best in AC season (Q1) and festive season (Q3/Q4)
🧾 11. Peer Comparison – Who Else in the Game?
| Company | P/E | ROCE (%) | Sales (₹ Cr) | OPM (%) | PAT (₹ Cr) |
|---|---|---|---|---|---|
| EMIL | 34.6 | 10.3 | 6,965 | 6% | 160 |
| DMart (Avenue Super) | 100.2 | 18.0 | 59,358 | 7.6% | 2,707 |
| V-Mart Retail | 260.9 | 8.5 | 3,253 | 11.6% | 24 |
| Shoppers Stop | 531.4 | 7.9 | 4,627 | 15.3% | -0.06 |
| Vishal Mega Mart | 96.3 | 13.1 | 10,716 | 14.2% | 631 |
EMIL is cheaper on P/E, but offers much lower margins and ROCE
Margins are ~half of DMart and Vishal Mega Mart
📊 12. Miscellaneous – Shareholding, Promoters, KMP
| Shareholding (June 2025) | % |
|---|---|
| Promoters | 65.17% |
| FIIs | 7.18% |
| DIIs | 17.22% |
| Public | 10.42% |
- Promoters sold ~13% over FY24
- Public shareholding has increased in Q1FY26
- FIIs down from 9.2% → 7.2% (Q-o-Q dip)
- No dividends despite 6 years of profits
🧑⚖️ 13. EduInvesting Verdict™
Electronics Mart is a solid operator in a brutally competitive industry. Think of it as the South Indian DMart—but without the margin buffet.
The good:
- Consistent revenue growth
- Clean working capital cycle
- Strong brand in core region
The not-so-good:
- PAT fell in FY25
- Valuation isn’t screaming cheap
- Thin margins + rising interest cost = pressure
It’s a “compounder candidate”… if it can improve OPM by even 100 bps.
✍️ Written by Prashant | 📅 July 11, 2025
Tags: Electronics Mart India, Retail Stocks, Consumer Durables, Bajaj Electronics, DMart Peer, South India Retail, EMIL, Stock Analysis, EduInvesting
