Popular Vehicles & Services Limited , a leading automotive dealership company, has announced the extension of corporate guarantees totaling Rs 55.00 crore for its wholly owned subsidiaries. This move underscores the company's support for its subsidiaries' growth and financial stability.

Guarantee Details

The company has provided two significant guarantees:

1. A Rs 17.50 crore guarantee to The South Indian Bank Limited for Popular Autoworks Private Limited. This guarantee covers:

   • A renewal of a dealer finance facility of Rs 10.00 crore
   • A new term loan facility of Rs 7.50 crore

2. A Rs 37.50 crore guarantee to IndusInd Bank Limited for Popular Mega Motors (India) Private Limited. This guarantee is for:

   • Channel financing
   • Adhoc limits

Financial Implications

According to the company's statement, these guarantees are provided on behalf of subsidiaries that are part of the consolidated group. At present, there is no direct impact on Popular Vehicles & Services Limited other than the disclosure in its financial statements. This approach allows the subsidiaries to potentially secure more favorable terms for their financing needs while leveraging the parent company's financial strength.

Strategic Context

This move comes as Popular Vehicles & Services Limited is expanding its footprint across India. The company recently completed strategic acquisitions, including:

• A BharatBenz dealership in Punjab
• A Maruti Suzuki dealership in Telangana

These expansions, coupled with the extended corporate guarantees, suggest a broader strategy of strengthening the company's market position and supporting its subsidiaries' operational needs.

Company Performance

In its recent financial results, Popular Vehicles reported:

The company's performance reflects the challenges and opportunities in the automotive retail sector, with a focus on diversification and expansion into high-margin businesses.

Outlook

Popular Vehicles & Services Limited continues to navigate a dynamic automotive market. The extension of these corporate guarantees demonstrates the company's confidence in its subsidiaries and its commitment to their growth. As the company pursues its strategy of diversification and deeper market penetration, such financial support to subsidiaries could play a crucial role in achieving its long-term objectives.

Investors and stakeholders will likely watch closely how these guarantees and the company's broader strategy translate into financial performance and market position in the coming quarters.

Popular Vehicles & Services Limited (PVSL), a leading automotive dealership player in India, has reported a significant uptick in its performance for the quarter ended September 30, 2025 (Q2FY26). The company witnessed a 36.5% quarter-on-quarter increase in new vehicle volumes, reaching 13,012 units.

Financial Highlights

• Total income stood at Rs. 1,534.60 crores, marking a 16.6% increase sequentially.
• Adjusted EBITDA (including other income) was Rs. 53.00 crores, with margins at 3.5%.
• The passenger vehicle segment, including luxury vehicles, recorded 8,498 units with revenue of Rs. 664.30 crores.

Segment-wise Performance

Key Developments

1. GST Impact: Some customers deferred purchases following GST rate cut announcements in September, moderating the full impact of sales growth.

2. Divestments: The company completed the divestment of Vision Motors and Kuttukaran Green during the quarter.

3. Network Expansion: PVSL expanded its network with a new NEXA workshop in Kerala.

4. Corporate Guarantees: The company extended corporate guarantees for its subsidiaries:

   • Rs. 17.50 crores for Popular Autoworks Private Limited
   • Rs. 37.50 crores for Popular Mega Motors (India) Private Limited

Management Commentary

Naveen Philip, Promoter and Managing Director, stated, "Q2 is seasonally a stronger quarter for us, supported by the Onam festive period. While we saw healthy enquiry levels and improved footfalls, the GST rate cut announcement led to some purchase deferrals. This was predominantly a timing issue, and we expect Q3 to reflect stronger volume momentum."

Future Outlook

Management expects stronger volume momentum in Q3 as deferred purchases materialize. The company cites a favorable economic environment supported by GST rate reductions and improved monsoon conditions as positive factors for future growth.

Popular Vehicles & Services Limited continues to focus on expanding its presence across six states in India, leveraging its partnerships with leading OEMs in the passenger vehicle, commercial vehicle, and electric vehicle segments.