Versuni India manufactures and sells small home appliances under Philips and Preethi.
FY26: revenue ₹2,173.11 crore (+15.5%), PAT ₹172.63 crore (+38.7%), zero debt, ₹410.43 crore cash. At ₹750 the shares trade at 25.0x FY26 earnings.
Profit grew more than twice as fast as revenue. Why that happened — and whether it repeats — is the whole note.
Ownership. Versuni Holding B.V. holds 5,52,90,242 shares, or 96.13%. Ultimate holding company is Versuni Group B.V. Total paid-up capital is 5,75,17,242 equity shares of ₹10 each. Public float is 3.87%.
Brands. Philips is licensed — the company pays royalty and brand licence fees to Versuni Netherlands B.V. Preethi is owned, carried at ₹119.09 crore of goodwill, never amortised, passed impairment testing at a 6.60% discount rate.
Category | Brand | FY26 disclosure |
|---|---|---|
| Airfryer | Philips | +77% YoY, 200% search interest spike |
| Mixer grinders | Preethi, Philips | HL1000/HL1010 launch, ₹2,395–16,995 range |
| Garment care | Philips | STH5000 sales 2x predecessor |
| Air purifiers | Philips | De-seasonalising, expanding beyond North India |
| Gas stoves, chimneys | Preethi | Silverin glass-top launch |
| OneChef | Philips | 33 functions, launched FY26 |
Workforce: 1,353 as at 31 March 2026.
₹ crore | FY26 | FY25 | Change |
|---|---|---|---|
| Revenue from operations | 2,173.11 | 1,880.85 | +15.5% |
| Other income | 12.19 | 12.75 | -4.4% |
| Total income | 2,185.29 | 1,893.54 | +15.4% |
| EBITDA | 271.62 | 202.10* | +34.4% |
| Finance costs | 7.15 | 7.01 | +2.0% |
| Depreciation | 33.08 | 28.35 | +16.7% |
| Profit before tax | 231.39 | 166.74 | +38.8% |
| Tax | 58.76 | 42.26 | +39.0% |
| Profit after tax | 172.63 | 124.48 | +38.7% |
| EPS (₹) | 30.01 | 21.64 | +38.6% |
*FY25 EBITDA derived as PBT + finance costs + depreciation. The company discloses EBITDA for FY26 only.
Two Ratios Moving in Opposite Directions
Metric | FY26 | FY25 |
|---|---|---|
| Gross margin | 43.5% | 40.3% |
| Net profit margin | 7.90% | 6.57% |
| Return on equity | 43% | 36% |
| Return on capital employed | 44% | 39% |
| Inventory turnover | 5.05x | 4.87x |
| Receivables turnover | 16.37x | 13.60x |
| Payables turnover | 4.53x | 5.67x |
| Effective tax rate | 25.4% | 25.3% |
Receivables turnover improved 20% — collections got faster. Payables turnover fell 20% — the company is paying suppliers slower. One is operational improvement. The other is a working capital lever. Only one of them can be pulled twice.
₹ crore | FY26 | FY25 | Change |
|---|---|---|---|
| Cost of materials consumed | 558.26 | 288.98 | +93.2% |
| Purchases of stock-in-trade | 551.45 | 900.45 | -38.8% |
| Changes in inventories | 111.46 | (80.15) | — |
| Total COGS | 1,221.17 | 1,109.28 | +10.1% |
Revenue grew 15.5%. COGS grew 10.1%. That 5.4 percentage point wedge is the margin.
Look at the top two lines. Materials consumed nearly doubled while purchases of finished traded goods fell by more than a third. The company stopped buying finished appliances and started making them — Ahmedabad and Chennai, 25,000 sq metres combined.
How Much Runway Is Actually Left: 200-300 bps, and Then It's Over
Foreign exchange outgo was ₹245.48 crore in FY26 against ₹59.01 crore earned. That ₹245 crore is the import bill still to be localised. Against a ₹1,221 crore COGS base, roughly 20% of cost of goods remains imported.
If the remaining ₹245 crore were localised at the same margin benefit observed this year, gross margin has perhaps another 200-300 bps available. That is the honest upper bound — and it is finite.
The 690% Cash Flow Surge Is Mostly Not Cash Flow
₹ crore | FY26 | FY25 |
|---|---|---|
| Operating profit before WC changes | 261.59 | 192.45 |
| Change in receivables/other assets | 31.02 | (32.60) |
| Change in inventories | 75.15 | (103.11) |
| Change in payables/other liabilities | 160.45 | 53.08 |
| Cash generated from operations | 528.21 | 109.82 |
| Operating cash flow (post tax) | 468.58 | 59.30 |
Operating cash flow rose 690%. But ₹266.62 crore of that — 57% — came from working capital movements, not earnings. Inventories released ₹75.15 crore as traded goods stock collapsed from ₹208.50 crore to ₹75.00 crore. Payables extended ₹160.45 crore.
Strip working capital out and the underlying figure is ₹261.59 crore against ₹192.45 crore — up 36%, tracking profit growth. That is the sustainable number. The ₹468.58 crore headline is a one-time inventory unwind plus supplier stretch.
Market capitalisation = 5,75,17,242 × ₹750 = ₹4,313.79 crore
₹ crore | |
|---|---|
| Market capitalisation | 4,313.79 |
| Less: cash and deposits | (410.43) |
| Add: lease liabilities | 79.78 |
| Enterprise value | 3,983.14 |
Multiple | Value | Calculation |
|---|---|---|
| P/E | 25.0x | ₹750 ÷ ₹30.01 |
| P/B | 9.79x | ₹750 ÷ ₹76.63 book value |
| EV/EBITDA | 14.66x | ₹3,983 cr ÷ ₹271.62 cr |
| EV/Sales | 1.83x | ₹3,983 cr ÷ ₹2,173 cr |
| MCap/Sales | 1.99x | ₹4,314 cr ÷ ₹2,173 cr |
| Dividend yield | 2.27% | ₹17 ÷ ₹750 |
Book value per share = total equity ₹440.79 crore ÷ 5,75,17,242 shares = ₹76.63.
The normalised test. FY26 EPS of ₹30.01 embeds the one-time margin step. Applying FY25's 6.57% net margin to FY26 revenue gives PAT of ₹142.77 crore and EPS of ₹24.83 — implying 30.2x at ₹750. The true multiple sits between 25x and 30x depending on how much of the margin gain you treat as permanent.
Our view: most of it is permanent, because the localisation is structural. But the rate of improvement decelerates from here.
Margin expansion is real and partly repeatable. 320 bps achieved, roughly 20% of COGS still imported.
Cash generation is genuine even after adjustment. ₹261.59 crore of pre-working-capital operating cash on ₹172.63 crore of PAT — cash conversion above 150%.
Zero debt. No borrowings at any point in FY26. Auditors confirm the company was never sanctioned working capital limits above ₹5 crore against current assets.
Returns improving. ROE 0.36 to 0.43, ROCE 0.39 to 0.44.
Category leadership is documented, not asserted. Euromonitor No. 1 in ironing and air purifiers. World Book of Records for Preethi Zodiac.
Clean audit. Unmodified opinion from S.R. Batliboi. No fraud reported. No qualifications on the financial statements themselves.
Dividend paying. ₹17 per share, ₹97.78 crore total, a 56.6% payout ratio.
1. The Philips Brand Fee Grew 73% While Revenue Grew 15%
₹ crore | FY26 | FY25 | Change |
|---|---|---|---|
| Royalty | 14.27 | 8.23 | +73.4% |
| Brand licence fees | 34.14 | 19.80 | +72.4% |
| Total | 48.40 | 28.03 | +72.7% |
| As % of revenue | 2.23% | 1.49% | +74 bps |
It is neither fixed nor a simple percentage of sales. The report describes the arrangement only as "based on transfer pricing guidelines" and "at arm's length." No rate, no formula, no term, no escalation mechanism is disclosed.
Sizing the risk: at 2.23% of revenue it consumes 28% of PAT. If it reached 4% of revenue on the current base, that is ₹87 crore — a further ₹39 crore against a ₹173 crore profit pool.
2. ₹164 Crore Went to the Parent. Profit Was ₹173 Crore.
₹ crore | FY26 |
|---|---|
| Dividend to Versuni Holding B.V. | 93.99 |
| Royalty + brand licence | 48.40 |
| IT charges | 14.12 |
| Support services | 1.39 |
| Reimbursement of expenses | 6.33 |
| Total outflow to parent group | 164.23 |
That is 95% of a year's profit flowing to the parent group. Some of it is legitimate cost recovery. But the aggregate is worth stating plainly.
The company also purchased ₹49.96 crore of goods from Philips (Jiaxing) Health & Technology and ₹30.43 crore from Versuni Netherlands — related-party supply that will presumably shrink as localisation proceeds.
3. One Unnamed Customer Now Buys a Fifth of Everything
One customer at 20% of revenue (₹429 crore), up from 15% (₹311 crore). Identity not disclosed. Rebates run ₹328.59 crore, or 12.8% of gross contracted price of ₹2,569 crore.
The direction matters more than the level. It rose 5 percentage points in a year.
4. Nobody Is Raising Money Here — They're Selling
The October 2025 board resolution approved an IPO comprising an offer for sale by certain existing shareholders. No fresh issue was mentioned in the secretarial audit disclosure of that resolution.
Shareholders separately voted down two resolutions during the year: a 1:1 bonus issue of 5,75,17,242 shares, and an increase in authorised capital from ₹131.1 crore to ₹231.1 crore. Both were majority-rejected.
An ESOP plan for 11,50,344 options was approved in November 2025 — 2% dilution if fully exercised.
5. The E-Waste Liability Grew 147% and Nobody Provisioned for It
₹ crore | FY26 | FY25 |
|---|---|---|
| Income tax disputes | 54.97 | 56.74 |
| Indirect tax | 2.45 | 2.68 |
| E-waste (EPR) | 28.31 | 11.48 |
| Total | 85.73 | 70.90 |
CPCB issued guidelines at ₹22/kg for EPR certificates; the company has taken legal advice that Rules 15(9) and 15(10) are under constitutional challenge before the Delhi High Court and has recognised no provision. If that challenge fails, ₹28.31 crore crystallises.
The largest single tax item is ₹45.83 crore for AY 2021-22, pending with the Assistant Commissioner, Kolkata.
6. The Books Weren't Backed Up in India for 11 Months
The auditors noted the Philips Domestic Appliances division did not maintain a daily backup server physically located in India from 1 April 2025 to 9 March 2026 — a Section 128 requirement. Remediated from 10 March 2026.
Separately, audit trail was not enabled for direct database changes under certain access rights. No tampering was found, but these are control weaknesses flagged in an otherwise clean report.
7. Labour Codes Took ₹9.5 Crore, and the Rules Aren't Final
The four Labour Codes implemented 21 November 2025 increased gratuity obligation by ₹5.57 crore and leave obligation by ₹1.43 crore, plus ₹2.55 crore for fixed-term and contractual employees. Absorbed in FY26. Final state rules are pending, so further adjustment is possible.
8. Ad Spend Is Growing Faster Than Sales
₹252.10 crore, 11.6% of revenue, up 16.5%. If brand spend must track or outpace sales, operating leverage is constrained.
Category-wise revenue and margin. Single segment under Ind AS 108, giving only geography: India ₹2,141.53 crore, outside India ₹31.58 crore.
Philips licence rate, formula, term or renewal conditions.
Identity of the 20% customer.
Volume or unit data of any kind.
Management guidance.
Capacity utilisation at Ahmedabad or Chennai.
At ₹750 you are paying 25.0x reported FY26 earnings, or roughly 30x on normalised margins, for a debt-free business generating ₹262 crore of underlying operating cash on ₹2,173 crore of revenue.
The core operation is sound. Margin expansion came from a real structural change with roughly 20% of the import base still to convert. Returns are improving, cash conversion exceeds 150%, and the category positions are externally validated rather than self-declared.
Three things should temper enthusiasm.
The 38.7% profit growth will not repeat. It came from a sourcing switch, not from selling more. Underlying growth is closer to the 15.5% revenue line with decelerating margin gains layered on.
₹164 crore left the company for the parent group in FY26 against ₹173 crore of profit — and the largest component, the brand licence, rose 73% in a year under a formula nobody outside the company can see.
The equity story is a sell-down, not a capital raise. The controlling shareholder holds 96.13% and has approved an offer for sale while shareholders blocked a bonus issue and a capital increase.
The DRHP should disclose the licence terms, the offer size, the retained stake and category-level economics. Those four items are material to this valuation and none of them are available today.