Steelcast has ended Fy23 on a great note.
https://www.bseindia.com/xml-data/corpfiling/AttachLive/42216711-a8ac-49ca-9380-0780e7c7e47b.pdf
Revs 477 cr vs. 302 cr,up 58%
EBITDA 114 cr vs 64 cr,up 78%
PAT 71 cr vs 33 cr,up 115%
Return ratios are now in excess of 35% while co. is still at 55% utilization.Company continues to be debt free & WC saw a substantial improvement.Thus,for FY23 they were able to generate OCF of 107 cr.
Concall was held today. Some highlights:
→ Finished with around 16,000 MT volumes sold. Thus,27% volume growth…rest was contributed by higher realizations.
→ Some clients have delayed orders.Most significantly,there was delay in ramp-up of railroad order.Company expects H1 to be flat on volumes,H2 might see recovery.Will have more visibility from Q1/Q2.
→ Will save 10 cr on power cost & all will flow straight to bottomline.Thus,margins can expand from Q4 base other things being equal.
→ Jump in PP&E is mainly on account of solar power plant.Going ahead,nominal capex of 10-12 cr will be done in Fy24.Mostly for balancing equipment & debottlenecking purposes.
→ The board will take a call on utilization of cash once capex outlook is clear.In case,no capex is needed company will come back to shareholders for suggestions.Dividend payout is 20%
→ Order book stands at 123 cr
→ Company strives to be in margin range of 22-23% but Fx or RM tailwind can prop margins further.However,there were no one-offs in Q4.RM prices are stable now.Realizations are down by 1.8%
Call ended a bit abruptly since Mr. Chetan Tamboli was having to answer same questions again & again.One interesting development is that Mr. Rushil Tamboli(his son) is back as a whole-time director & will start to handle day to day ops soon.This should remove succession overhang on the co(if any)
Stock has had a long consolidation post a large move from 300-ish levels last year.However,given tepid near term outlook stock may continue to be in a range for longer.
Disc.: Invested. Views are biased.
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