Landmark Cars - Listed premium Car dealership in India

Stock Opportunities Untested - but worth a good look
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Aadhar - This is quite helpful. If you are doing it regularly, I suggest you do it on Google Sheets and share the link over here.
It’s important to track these announcements. Thanks for doing this.

Also, wanted to know - what’s the point of ‘No of Investor Tracking’. How does that affect the performance and where do you get that data?

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PAT negative growth q1 fy25 yoy instead of positive sale growth why ? Please give your suggestion

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Over the past year, new outlets have been added, with plans to open more this year to strengthen presence in existing areas and expand into new regions. However, it will take time for these outlets to reach full operational capacity, which is currently contributing to a lower operating profit margin. Additionally, these new outlets have led to higher depreciation and interest expenses, resulting in a year-over-year decline in PBT.

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28

Hit of ebitda because of new showrooms is understandable.

But one issue that i see with Landmark is their low PAT/ EBITDA to CFO (adjusted for financial liabilities) conversion for last 3-4 yrs.

Further with MB’ share in revenue increasing, need of funds for inventory should have been rather reducing.

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29

Landmark Cars | Business Update

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  • Financial Performance:
  • Total revenue growth YoY and QoQ across segments: Vehicle sales, pre-owned vehicle sales, and after-sales services.
  • Inclusion of Mercedes-Benz sales under the agency model.
  • Operational Expansion:
  • 7 new facilities commenced operations in Q3FY25, including Mahindra and Kia outlets in Hyderabad.
  • 22 out of 24 planned outlets completed ahead of schedule.
  • Product Launches:
  • Multiple new launches planned by partner OEMs, such as Mahindra BE.6 EV, Kia Syros, and BYD Sea Lion SUV.

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Workshops Update:

  • Opened 9 new workshops in the fiscal year, with further additions planned in Q4FY25.
  • Kia Hyderabad and Mercedes-Benz Patna operations to begin soon.
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30

Crux of the business is documented well in the starting post. But few more thoughts from my side:

  1. Wealth Accumulation - As people get richer, and get higher disposable income, spending tends to go to discretionary items (e.g. Luxury Cars). China can be the closest proxy to study how sales of luxury cars exploded when income level reached a threshhold. Will it happen in India, time will tell.

    But if you want to play that theme, Lankmark is one of the options.

  2. Multi Brand - Landmark has dominant market share of top 5 brands in its bucket (Mercedes, Honda, Jeep, Volkswagon). Betting on landmark means you are not betting on single brand, and your risk is diversified. Multibrand tailwind is Dealer’s tailwind.

Negatives -

  1. Margins are razor thin (~5%), though servicing margins (annuity business) are high.
  2. Inventory management is critical, and doing capex with right brand at the right location is crucial.
  3. Point 2 means, you need to have management with razor sharp focus. Its a game where you have to stay smart on daily basis. You are betting on the jockey (management) and not the horse (business)

Base rate (Probability of success) can be in your favor, if :

  1. You pay the right price
  2. You believe management can execute.
  3. You are confident that management is ethical and will not take minority investors for a ride.

Dont ask me my opinion about the above, as I am yet to make my views about these points.

Disclosure - Not invested

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Landmark Cars | Q3FY25 Highlights

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  • Highest ever Proforma Revenue in Q3FY25 with 28.2% YoY growth
    • Highest Quarterly EBITDA in the last eight quarters

Opened 23 new outlets in 9MFY25

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32

I strongly believe for landmark to generate meaningfull growth , the service realisation as a percentage of total revenue need to grow. Currently it is around 17%. Along with the showrooms, they need to start workshops and increase the share of services. Untill then margins will be suppressed.

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33

Yes in my city Hyderabad, Landmark has opened almost 4 show rooms of mahindra and I am able to see their footprint in Kia, byd also expanding now.

But It’s good to see they are coming to low-cost cars bcz the majority of people will be interested in buying low-end cars for less than 20 lakhs.

certainly I’m very much positive about this space and took my fresh entry around 530. worth considering for long-term and its valuations are much attractive post correction.

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34

I own a car bought from Landmark & they have my servicing contract.

A competing official dealership of the OEM called a family member and lied that the servicing has now shifted to them. (Data probably shared by OEM)

During servicing they raised some absurd “Additional Servicing & Repair Costs” requirement which was bought to my attention. I called Landmark after that and realised that my contract was still with them.

While my issue has been resolved for now - but this shows how VULNERABLE/Non-Existent the MOAT of the company is!

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