Kajaria ceramics Q3 concall highlights –
Slow demand in Oct due festivals and extended holidays. Resurgence in demand seen in Nov, Dec
Sales at 1091 vs 1068 cr
EBITDA at 133 vs 180 cr, Margins down 500 bps, at 12 pc
NP at 74 vs 125 cr
Started using alternate fuel wet Dec 23
This should result in significant savings in power and fuel cost
Bathware, Plywood revenues (included in Consolidated revenues) at 79 vs 82 cr and 19 vs 25 cr
EBITDA contraction due disruption in gas supply, very high gas prices
WC days at 66 vs 62 due increased inventory
Blended fuel prices ( Gas + Alternate ) for the company are down almost 14 pc in Q4 – company resorting to dealer level discounts to stimulate demand
Jan demand has been tepid
Nepal plant (new one) to be ready by Mar 24. Its coal fired, Margins likely to be higher
Expect to achieve 14 pc+ EBITDA margins in Q4
FY 23 capex at 90 cr. Next year should be 300 cr+
Current capacity utilisation at 90-93 pc
Bathware brand ( Kerovit ) making descent progress
Sustainability of alternate fuel (bio fuel) is not an issue. Avlb in abundance
Divesting their stake in Vinar plant (to receive divestment proceeds ie 18 cr in Apr 23). Aim to fulfil supply shortage by sourcing from Morbi based manufacturers
Composition of alternate fuels at 35 pc of the total (30 pc biofuels and 5 pc Lpg). Rest remains natural gas
Current industry size at 52k cr. Domestic at 40k cr. Rest is exports
Supply of bio fuels is not a constraint round the year. Even bio fuels prices likely to moderate till May 23
Planning to set up a JV in Dubai Mkt. To mainly concentrate on exports in Gulf and North Africa
Large slab tiles seeing good traction in India. Plus the price realisation and margins here are much better
For 9M, plywood and laminates business is up 20 pc. Should reach good scale in 3-4 yrs
Morbi players did 1500 cr exports each in Nov,Dec
Shows buoyancy in export mkts. Kajaria can this exploit going fwd
Aim to add 400 dealers in next 3 yrs. Added 125 dealers in last 9 months, 35 of which were exclusive Kajaria. Total dealer count at 1825 now
Disc: invested, biased
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