VIP Industries: Why have analysts put the stock 'Under Review'? Check here

The brokerage, which earlier had a 'Reduce' rating on VIP Industries, said the near-term outlook has turned 'hazy,' warranting caution until the new leadership outlines a credible turnaround plan.

VIP Industries stock analysis: Luggage company VIP Industries has been brought “Under Review” as analysts at Nuvama say the company has entered a transitionary phase marked by weak earnings, management churn and an uncertain revival roadmap. 

 

The brokerage, which earlier had a ‘Reduce’ rating on the stock, said the near-term outlook has turned ‘hazy,’ warranting caution until the new leadership outlines a credible turnaround plan.

 

“With the near-term outlook remaining hazy, we put the stock ‘Under Review’ from the ‘Reduce’ rating earlier,” said Rajiv Bharati and Ashish Vanwari of Nuvama, in a note dated November 15.

 

Poor Q2 show

 

The Q2FY26 performance only reinforced concerns. VIP posted a 25.3 per cent year-on-year (Y-o-Y) revenue decline, capping a three-year stretch of lacklustre growth. 

 

But the bigger surprise, according to analysts, was the sharp erosion in profitability. The gross margin collapsed to 30.6 per cent, down from 45.1 per cent a year earlier, an abrupt fall that analysts at Nuvama described as a reflection of management and ownership transition and an aggressive clean-up of the books.

 

Operating performance deteriorated even more sharply. Earnings before interest, tax, depreciation and amortisation (Ebitda) margin plunged to -26.2 per cent, compared to -0.4 per cent in Q2FY25, driven by higher costs, inventory rationalisation and restructuring-related pressures. This translated to an Ebitda loss of ₹110 crore and a profit after tax (PAT) loss of ₹145 crore, with PAT margins at a steep -35.2 per cent.

 

Adding to the uncertainty is the changing guard at the company The promoter group has agreed to sell up to 32 per cent stake to Multiples Private Equity and other buyers, effectively marking their exit. As part of the deal, the new promoters have launched an open offer at ₹388 per share, valuing the company at around ₹550 crore.

 

This ownership shift has triggered a major leadership churn, analysts opined. Former managing director (MD) Neetu Kashiramka has exited. Atul Jain has taken over as the new MD, marking the beginning of a fresh chapter for the iconic luggage maker.

 

Nuvama said visibility on the transformation remains low. “The new management has not yet articulated a clear pathway to revive growth or restore margins,” the brokerage noted.

 

For now, analysts believe the stock will be driven more by sentiment around the incoming leadership and clarity on strategy than by near-term fundamentals.

 

The key trackable from here is the turnaround plan and timelines associated with it, analysts at Nuvama said.

 

VIP Industries stock price history

 

VIP Industries shares have slipped nearly 5 per cent over the past five sessions, extending a broader downtrend that has pulled the stock lower by 15 per cent in six months and 14 per cent over the past year.

 

However, on Friday, November 14, 2025, the stock managed to buck the recent weakness, closing 0.7 per cent higher at ₹398.25. In comparison, the BSE Sensex inched up 0.1 per cent to settle at 84,562.78.