Redington Limited - Q2FY2023 Review

Redington Limited reported net revenue of ₹19,050.74 crores for the quarter ended September 30, 2022, compared to ₹15,287.46 crores for September 30, 2021. Profit After Tax was ₹391.91 crores for the quarter ended September 30, 2022, compared to ₹323.09 crores during the corresponding quarter of the previous year, respectively.

Redington Limited - Investment Summary

Redington Limited - Overview

1. In India, the Middle East, Turkey, and Africa, Redington Ltd is a top distributor of IT and mobility products and a supplier of supply chain management systems and support services.

2. IT and mobility items are purchased by Redington Ltd from vendors, distribution logistics are handled, and the products are then sold to resellers and dealers. The company continues to offer ancillary services including after-sales support and third-party logistics through its subsidiary businesses and has periodically introduced new goods to its inventory.

Redington Limited - Quarterly Summary

Business

• In 1993, Redington Limited started doing business by marketing items for the information technology industry.

• 1995 saw the beginning of Redington's operations in Eastern India. That same year, the business also started distributing Compaq and Philips products. In the year 1996, the business began to distribute Intel products.

• In the year 2007 the company’s shares got listed on NSE and BSE and in the same year, it commenced distribution of Apple products.

• Throughout FY 19–20, the company made significant strides in its pivot toward being a solution-oriented distributor and strengthened its competencies in crucial new technologies, including cloud cybersecurity, the internet of things (IoT), artificial intelligence (AI), and machine learning (ML).

• In 1997, the company formed a partnership with Microsoft for the marketing of software products. In 1998, the company also formed partnerships with IBM APC and Canon for the distribution of their products. The company has a wide network and strong relationships with over 290+ brand associations and servicing 43,000 + channel partners.

• The company has been assigned AA+ long-term rating by ICRA/CRISIL.

• Out of the total revenue, 97% has been generated from Distribution Products and 3% from Services in FY 2022 compared to 98% and 2% in FY 2021, respectively.

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• Geographically contribution from India was 43% and from Outside India was 57% in FY 2022 compared to 40% and 60% in FY 2021, respectively.

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SWOT ANALYSIS

• Strength

  • Strong product and service portfolio.

  • Strong Brand Value.

  • Long-term vendor relation.

  • Strong Financials.

  • Wide reach and superior logistics capabilities.

• Weakness

  • Extra cost of building a new supply chain & Logistics Network.

  • Zero Promoters’ shareholding

  • High cost of goods sold.

• Opportunity

  • Local collaboration.

  • Increasing customer base in the lower segment.

  • Increasing government regulations.

• Threat.

  • Increasing global uncertainties.

  • Increase in competition.

  • Dependency on top five clients for revenue.

  • Company’s low market share in Non-IT Products.

Redington Limited - Ratio Analysis