Virtuoso Optoelectronics - Robust Growth With Product Expansion: Prabhudas Lilladher

Prabhudas Lilladher Report

We met with management of Virtuoso Optoelectronics Ltd. that manufactures consumer durable goods, assembles a range of products and provides end-to-end product solutions. The company plans to expand its annual indoor units capacity of room air conditioner from 0.6 million to 0.8 million units and outdoor units of room AC from 0.25 million to 0.4 million units in FY24.

Lighting capacity will remain constant at 34 million lamp equipment units. Virtuoso Optoelectronics operates from four manufacturing facilities spreads across Nashik (Maharashtra) with one facility each for indoor units), outdoor units, lighting and plastic components and cross flow fans which uses production linked Incentive scheme and its applications for white goods (AC and LEDs) approved in November 2021.

The company reported revenue/Ebitda/profit after tax compound annual growth rate of 70.4%/61.5%/76.8% over FY20-23. Management expects revenue CAGR of 35-40% in the next three years led by volume growth and higher utilisations.

At current market price, the stock trading at price-to-earning of 56 times/35 times/23 times on FY23/FY24/25E earnings, considering 57% CAGR over FY23-25. We don’t have rating on stock.

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