EVEREADY - Eveready Industries India Ltd. Share Price

In the Q3 FY26 earnings conference call, Eveready Industries' management provided an optimistic outlook amidst a mixed demand environment. CEO Anirban Banerjee highlighted that the company has successfully achieved its fifth consecutive quarter of revenue growth, with a 10.1% rise in revenue and a 13% growth in EBITDA driven primarily by the batteries business, which increased by 11.1%. The core battery segment held a value share of 51.9%, with the zinc battery share at 58.3%.

Major forward-looking points included:

• The alkaline battery volume share grew significantly, reaching nearly 19% by the end of December 2025, indicating strong traction in this category.
• Eveready is poised to enhance its manufacturing capacity as the Jammu alkaline battery facility is on track for completion by the end of FY26, which is expected to improve margins by approximately 10%.
• The company is maintaining a focus on premiumization to enhance profitability, with an emphasis on new product launches, including lithium batteries under the Ultima brand.
• Effective cost management measures and price adjustments were mentioned as strategies to combat elevated input costs, resulting in net debt reducing to INR 317 crores.
• The planned divestment of a non-core land parcel in Noida is expected to generate a minimum value of INR 250 crores, aimed at enhancing financial flexibility and debt reduction.

Overall, the management conveyed confidence in continuing the growth momentum while positioning the company strategically for future opportunities.

1. Question: "So my first question is that year-on-year, we had around 150 basis points fall in the gross margin. So what were some of the reasons for this?"
Answer: The reduction in gross margin was primarily due to the significant increase in raw material costs, particularly zinc and dollar rates, which exceeded the price increases we implemented. This dip is somewhat seasonal, and we expect margins to stabilize moving forward as market conditions improve.

2. Question: "With regards to the disinvestment of the noncore land parcel in Noida, would it be possible to quantify some of the benefits that we can receive from this over the next couple of years?"
Answer: We received in-principle approval for the disinvestment, projecting a minimum value of INR 250 crores for the land. The primary aim is to utilize proceeds for debt reduction, thereby enhancing our financial flexibility.

3. Question: "If you could provide the number for the advertisement expense this quarter, it would be helpful? And the second question I had was on quick commerce. If you could tell us what was the percentage of sales coming from the quick commerce channel this quarter?"
Answer: Our advertisement expense for the quarter was approximately INR 41 crores. In terms of e-commerce, it accounted for about 4-5% of our total revenue, with around 55% of our e-commerce sales coming from quick commerce.

4. Question: "Would it be possible to tell me what was the absolute volumes in terms of million batteries sold for carbon and alkaline as well as Y-o-Y growth?"
Answer: We sold approximately 1 billion batteries year-to-date, reflecting a growth of about 4% to 4.5% over the previous year's period. This figure includes both carbon zinc and alkaline batteries.

5. Question: "What would be the ramp-up schedule kind of a thing that we should think of over the next 1, 2, 3 years for the Jammu facility?"
Answer: Upon commencing operations, we anticipate utilizing about 25-30% of the plant's capacity in the first year, aiming to reach 40-50% utilization by year two, driven by both domestic demand and potential white-label opportunities.

6. Question: "On the overall portfolio, can you detail other product launches that can be cross-sold through your distribution channel?"
Answer: Beyond batteries and lighting products, we've launched mosquito rackets and mobile accessories. Going forward, we aim to introduce more complementary categories while consolidating our existing strengths to enhance distribution.

7. Question: "How much value are you expecting from the Noida land monetization?"
Answer: The Board has indicated a target of a minimum INR 250 crores from the Noida land monetization. We will consider additional opportunities as they arise, aiming for strategic operational efficiencies.

8. Question: "What could your market share look like by the end of FY '27?"
Answer: While it's challenging to specify an exact figure, we've consistently increased our market share with our alkaline sub-brand Ultima. We expect continued growth, given the progress we've made over the last 24 months.

9. Question: "With key raw material prices becoming volatile, do you see any potential market share gains?"
Answer: The organized nature of the battery market means that significant unorganized player volatility is unlikely. However, we believe our brand leadership positions us to navigate these challenges better than most other players.

10. Question: "What incentives are linked to the Jammu plant?"
Answer: The incentives largely relate to GST reimbursements tied to sales from the plant, with a potential for significant benefits once operational, as we've consistently followed up for approval from government authorities.