AMI Organics Q1 FY 24 concall –
Sales – 142 cr, up 9 pc
EBITDA – 25 cr, up 10 pc
PAT – 16 cr, up 12 pc
Gross margins at 44.8 vs 48.8 pc due change in product mix
Export:Domestic sales @ 37:63
Fermion contract – validation batches sent. Commercial production to begin in Q4
Electrolyte additives samples approved by 06 customers. In advanced stages of contract negotiation with a couple of customers
Revenue split –
Pharma Intermediates:Speciality chems – 84:16
Company produces advanced Pharma intermediates across 17 therapeutic areas
Has developed 185+ products with 90 pc plus products with chronic therapy focus. Majority products backward integrated to basic chemical level. Has 50-90 pc global mkt share in key molecules
Last 4 yrs sales CAGR @ 31 pc in Pharma intermediates
190 cr capex lined up for Pharma intermediates
Expect to continue to grow sales at historical rates
Speciality Chemicals sales up from 7.4 cr to 99 cr in last 4 yrs
Ami has successfully developed a core electrolyte additive for cells used in energy storage
First global company outside China to develop this. Samples approved by 06 customers
Spec Chem business to grow at rates > Pharma intermediates growth rates
Existing Spec Chem business supplies KSMs to Agrochem and fine chemicals industry
In Q1, pharma intermediates, spec Chems grew by 5pc and 25 pc respectively. This when Chinese manufacturers have been dumping all kinds of intermediates, Spec Chems and causing huge pricing pressures
Q1 is historically the weakest Qtr for the company
Did not disclose the capex/preparations required for supply of electrolyte additives citing confidentiality
Fermion orders are for 10 yrs. Supplies to begin in Q4. Full impact to be seen in FY25. Did not disclose the revenue potential from this again citing confidentiality
Fermion contract is for supply of Pharma intermediates for their on patent API
Electrolyte additives business likely to be much bigger than initially anticipated by the company
Q1 numbers do not include the numbers of Baba Finechem (where the company acquired 55 pc stake in Q1)
Company expects the current electrolyte capacity to be sold out in FY 24
Pharma Intermediate EBITDA margins in Q1 were around 20 pc. Should move up for the rest of the year
The margin profile of Electrolyte business to be similar or better than company avg
To understand the true potential of the company, this video link posted below may be really helpful. Also explains why the company trades at such expensive valuations
Disc: holding
DHANDHA: Ami Organics Ltd – PART 2 | Let’s Talk Business | Omkara Pathshala
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