AGM FY2022 NOTES:
Ajay Anand,MD :
Achieved growth of 50% in revenue and 100% in Pat
Major capacity expansion was undertaken , considering we would hit peak capacity by 2022.
Made significant addition to the Mgt Team across functions over last 18 months to get us ready for the next big run.
over 95% of business comes from existing customers across different product lines and regions.
Have added many new products and lines in FY22 which is very satisfying and shall reap good rewards in coming years.
Questions from Ayush Mittal
Q.Visibility to double revenue from FY22 BASE?
In last 4 years co. has doubled its revenue.
Similar trends of the last few years is expected going fwd in next 3-5yrs.
All the building blocks are in place.
95% business come from existing customers and these are large retailers and the scope to deliver to them is quite large.
Capex
100crs plan has been disclosed and 65% has been undertaken and balance will be undertaken in next 12 months . All this expansion is brownfield.
Once this capex is over we will be able to 3x of our revenue.
Since we are multi product, multi factory, multi raw material kind of set up so there is no standard measure of capacity.
We had similar situations 3 yrs ago when we said that with existing capacities we can double our revenues and we delivered on it.
China+1
Its a reality.
If we go by the standard vision statement of the largest retailer of US.
They intend to more than Triple their purchases from India.
To quantify the largest retailer has intend to buy $10bn from India by 2027 from current $3bn.
US Inflation
Jobs and wage market is very healthy right now.
We have gone through 3 recessions in 2001,2008 & 2020 also. our mgt has gone through those last 3 recessions.
But the HOME IMPROVEMENT segment or merchandise segment where we belong generally do not see steep decline as compared to home interior or housing sector.
US unemployment is all time now
Not seeing any major issue there.
As against very high growth we will see moderate growth in this year.
On cancellations of orders
We didn’t face any cancellation of orders due to made to order business model.
We might not see high growth as of last year which was around 50-55% but we will see moderate growth.
Margins improvement- Operating Leverage has played out in last 2 years
Better product mix
Going fwd we don’t see any reasons why we should not sustain and grow margins as soon as our capacity utilization improve.
Margins are not there bcoz of China+1 but bcoz of inherent advantages of our business model.
Customer addition- We are yet to start business with some of the large retailers of the world. There are almost 5-10 large retailers across US with whom we are yet to start business with.
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