Popular Vehicles and Services Limited — Investor Meet, 12-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** Popular Vehicles and Services Ltd reported a total income of ₹3,016 crore for the nine months ended December 31, 2024, reflecting a 3.5% decline compared to the same period last year. Volume sales decreased by 5.2% year-over-year, alongside a greater shift in consumer preference towards SUVs and luxury vehicles. The average selling price (ASP) for new vehicles rose by 1.7% to ₹8,94,475, helping limit revenue loss despite lower volumes. EBITDA fell significantly by 32% to ₹72 crore, leading to a marked EBITDA margin decrease from 5.0% to 1.7%.

**Future Outlook and Growth Drivers:** Management noted that while the consumer industry remains challenged, recent RBI rate cuts may boost passenger vehicle demand. The company is strategically expanding its luxury vehicle offerings and EV partnerships, specifically with JLR and Ather, anticipating performance improvement from FY26 onwards.

**Order Book and Operational Updates:** The company achieved significant contracts including multiple Letters of Intent (LOIs) for establishing Ather dealerships in Kerala and Tamil Nadu, as well as a new JLR facility in Nagpur, Maharashtra, expected to be operational by H2 FY26.

**Analyst Q&A Insights:** Analysts sought clarity on revenue projections and margins. Management acknowledged external factors affecting demand but highlighted the ASP improvement as a key mitigation strategy for profitability. Addressing operational challenges, they displayed confidence in managing elevated inventory levels and indicated optimism regarding the transition towards luxury vehicles.

**Market or Regulatory Updates:** No significant regulatory changes were communicated that would impact strategy or operations.

**Strategic Focus Areas:** Key themes included enhancing luxury vehicle presence, diversifying revenue through EV partnerships, and optimizing operational efficiency in light of market challenges.

**Investor Insight:** Although currently facing short-term challenges with volume declines and reduced profit margins, the strategic emphasis on luxury vehicles and EV expansion suggests a cautiously optimistic outlook, pointing towards a potential ‘hold’ position based on the ongoing transformation and restructuring efforts.