- 15 Oct 2024
- ICICI Securities
LANDMARK CARS REPORTED A MUTED REVENUE FOR Q2FY25
News: As per the business update released by the company, total revenue from operations (including agency sales) for the quarter came in at ₹ 1,275 crore, up by 13.8% YoY. Within this, Vehicle sales (including agency sales) amounted to ₹ 1,013 crore, up by 15.2% YoY and After Sales service reported revenue growth of 10.9% YoY to ₹ 234 crore. Pre-owned vehicle segment also reported a revenue of ₹ 28 crore, down by 6.7% YoY.
Views: Revenue from the new vehicle sales segment came in below expectations. This can be attributed to the overall industry is reeling under high levels of new car inventory risen by ~80-85 days, signalling slower growth in the passenger vehicle industry. On the after-sales service front, the revenue growth was muted, even with the expansion into markets such as Mercedes Benz in Hyderabad and MG Motors in Mumbai. However, upcoming product launches from OEMs are expected to contribute positively in H2FY25. Furthermore, the opening of 7 new facilities for M&M and Kia in Hyderabad will aid the earnings of the company going forward. With a long-term investment horizon, we continue to have a positive view on the company.
Impact: Negative