Vadilal Industries: ₹1,280 Cr Sales + 50% PAT CAGR – Ice Cream Empire With a Chilling Cash Flow Twist
1. At a Glance 🍦
Vadilal Industries, born in 1907 as a soda shop, has grown into India’s second-largest ice cream brand — and also its most nostalgic one. With ₹1,280 Cr in annual revenue, ₹140 Cr in PAT, and a freezer full of juicy ROEs (24.3%), Vadilal has sweetened investor portfolios — until working capital blew up like a kulfi in the sun. Oh, and the stock’s down 33% from its peak. Coincidence? You decide.
2. Introduction
Imagine investing in a company that sells happiness in a cone — and makes ₹209 EPS doing it. Vadilal Industries isn’t just a summer darling; it’s a legacy frozen in time, battling modern brands, capital cycles, and dairy inflation.
Q1 FY26 came in strong at ₹506 Cr in sales and ₹67 Cr PAT, a neat recovery from the soft Q4. But is this a seasonal sugar rush or sustainable growth? With rising inventory days and ballooning working capital from 54 to 83 days, this ₹4,900 stock has a few brain freezes of its own.
Export of frozen fruits, vegetables, ready-to-eat = Rest
Market Position:
2nd largest brand in India
No. 1 in cones, cups, and candy categories
16% share of India’s organized ice cream market
Distributed in 45,000+ outlets pan-India
Think of Vadilal as Amul’s quirky cousin — less cooperative, more capitalist.
4. Financials Overview
Metric
FY25
Revenue
₹1,280 Cr
EBITDA
₹225 Cr
PAT
₹140 Cr
EPS
₹209.15
ROE
24.3%
ROCE
25.4%
P/E
25.3x
YoY PAT growth has stalled (-8% TTM), but that comes after a 3-year CAGR of 50%. Gross margins are stable at ~18%, but high seasonality makes Q1 & Q4 rollercoasters.
5. Valuation – Fair Value RANGE Only
Method 1: P/E Based
EPS: ₹209
P/E Range: 22x–28x
FV = ₹4,600 – ₹5,850
Method 2: P/BV Based
Book Value: ₹967
P/B Range: 4.5x–5.5x
FV = ₹4,350 – ₹5,320
Method 3: DCF (Estimate)
3-year PAT CAGR: 30%, assumed future CAGR: 18%
Discount rate: 13%
FV Range: ₹4,500 – ₹5,800
Method
FV Range (₹)
P/E
4,600–5,850
P/B
4,350–5,320
DCF
4,500–5,800
“This FV range is for educational purposes only and is not investment advice.”
6. What’s Cooking – News, Triggers, Drama
Q1 FY26: Revenue ₹506 Cr (+22% YoY), PAT ₹67 Cr
New Plants: Capacity expansion in Gujarat + North India planned
Exports: Frozen foods gaining traction in US, Middle East
Auditor Musical Chairs: Walker Chandiok in, PwC as internal auditor — someone smells growth… or skeletons?
7. Balance Sheet (100 Years of Cream)
₹ Cr
FY23
FY24
FY25
Equity
₹7
₹7
₹7
Reserves
₹390
₹535
₹688
Borrowings
₹291
₹223
₹218
Total Assets
₹838
₹917
₹1,096
Clean enough for an auditor picnic. Borrowings manageable, but rising CAPEX is visible.
