Just to clarify, 20% EBIDTA margins is what VDML plans to achieve in next few years and may not be the steady state margins in the near term. Last year was exceptional and their Manufacturing margins were above 20%, however, as always one should never make a steady state margin assumptions on one year number. The only thing we can infer from past data is that EBIDTA margins from manufacturing operations is consistently improving and inching towards their stated goal of 20% which will be achieved over next few years.
My take on Vidhi’s result was that management had indicated that their trading operations will be discontinued and hence topline was bound to fall. Also, the EBIDTA in absolute terms was bound to fall as well. What seems to support the hypothesis is the EBIDTA margin by almost 300 & 200 basis point YoY and QoQ.
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