At the AGM,the management had guided for 360 cr revenues in Fy24 & had clearly said that they don’t have capacity to generate more than 400 cr annual revenue(500 cr post expansion) Interestingly,in Q2 itself they are at ~425 cr annual run rate. Moreover,they had said that Q1 margins were one-off & won’t sustain since export share was too high. Yet they have done 28% EBITDA in Q2.
If people scroll up they will see that even for FY23 the management had guided for 16-17% margins & 225-50 cr kind of topline. So it seems clear to me that the promoter group likes to underpromise. It could also be that since the company has never made such margins they are being cautious in guiding the investor community since the improvement in EBITDA & GMs has been stratospheric in recent years. Company’s GMs have expanded all the way from 22-23% to ~40% in FY24. I had asked the management about this at the AGM however this question went unanswered. In any case,the execution of this company stands out vs peers. They are able to deliver high revenue growth alongwith strong profitability quarter after quarter. Stock has done very well but multiples have again fallen to 23x ttm or 17x(Q2 annualized) On the macro front things continue to align both domestically & internationally as @Dev_S has shared in some articles earlier.
Only issue with the company is that they aren’t willing to talk to investors outside the AGM which delays price discovery. No interviews to blogs or biz channels either. At the AGM we were assured of a concall soon. Hoping that now with marketcap at 1600 cr company can open up to the community.
Disc.: Invested. Views are biased.
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