Key Notes from Nov 22 Transcript - https://www.bseindia.com/xml-data/corpfiling/AttachHis/cde1ee15-08ca-419a-8e6f-6021ab96e70c.pdf
For the quarter ended September 30, 2022,
Income from operation is INR 234.15 crores Vs INR 233.46 crores previous year’s same quarter.
EBITDA as a percentage is 13.77 % Vs 16.44% previous year’s same quarter.
PAT for the quarter is INR 22.74 crores Vs INR 32.15 crores previous year’s same quarter.
Volume for power tillers for the quarter is 8,819,
Tractor volume for the quarter is 1,688.
Small farm mechanization vertical, the turnover is INR 136.8 crores for the quarter
Tractor business, 63.31 crores.
Spares business, 23.42 crores.
Distribution -started Pilots in UP and Bihar in electric pumps (trading) – expecting 5-10 Cr this year
Roughly about INR 50 crores to INR 60 crores of CapEx planned this year, against which the spend has been about INR 15 crores in H1
Margins - We are back in the guidance range. And I think it can only get better, unless, of course, there is a disruption again.
Major savings on two heads. One, we were able to drive several fixed cost savings projects in this quarter two, which has got some savings. Secondly, on the logistics side, we have tried to renegotiate our contract and also bring in new vendors. So a lot of savings we have brought in even in logistics cost also
We did take a price hike on tillers at about INR 2,000 per unit
we should be comfortably doing something like 10,000 units next year, in the tractor space
With the onset of the festival in October, the deliveries and retails have been good. So, expect the second half of the year to be better than the first half.
Unveiling of VST- Zetor Tractors, on November 4th at Chandigarh CII Agri Expo and the launch will happen later in quarter 4. Expecting upwards of 1,500 to 2,000 VST-Zetor tractors next year. The African market numbers will come after the four-wheel drive is launched, major numbers. It will be the latter half of next year (In addition to the above numbers)
We are investors and suppliers to Monarch Tractors. Foxconn is going to manufacture for Monarch. Expected launch early '23 . we expect good numbers. We are giving them the gear train, the front axle and the rear axle. And we are in development for some other components as well. Too early to give numbers, would wait for some more time before we can talk more in detail on that.
Launching like four higher HP, 28, 32 and then 45, 49 and plus VST Zetor range. Zetor range will be 45-59 but at a very different positioning, the features and benefits will be very different. It will be the premium range of tractors compared to any other premium multinational product.
Exports has seen a slight decline in the month of August and September. This is primarily due to the issues in Europe. Looking at winter, Inflation etc, don’t think it will be as buoyant as last year in terms of the tractor sales, especially in Europe.
About INR 3,000 crores target by FY '25. : The first task is we will be crossing the INR 1,000 crores milestone this year. The next two years, we have done a work-out, it is looking like INR 2,000 crores plus by FY '25, but all-out efforts are being taken to ensure that the INR 3,000 crores happen at least by FY '26. I want to add one more, if I may. See, once this vision has been set, we have not had a single normal year. We had COVID, then we had commodity inflation, all sorts of issues coming up. So we took a complete review of this INR 3,000 crores milestone. It looks like we will be delayed by one year, and we will be able to get it in FY '26.
- looking at lot of innovative products coming out of the small farm mechanization segment.
- wanting to enter the US market with our compact tractor range.
- getting into a serious play in our electric range of tractors.
Going forward in the next six months to one year, these projects are getting into a revenue realization mode, which will give us the quantum jump that we are looking at.
supply agreements in Farmech Taiwan and MTD USA for Brush cutters and small farm machines,
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Numbers are not great, but multiple partnerships, initiatives are being pursued. While the 3000Cr target seems slightly pushed, I feel if a couple of right things get firing, we can see good numbers . Am positive about the initiatives to track progress for next 3-4 quarters
- Invested.
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