Q2FY2024 Highlights:
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Lighting & Consumer Division: Muted 2% growth yoy inspite of bullish commentary in Q2 regarding shift of festival from Q2 to Q3. Overall consumer demand remained muted due to slow growth in the lighting business. While demand of premium segment was good. EBIDTA expansion on the back of incentive from PLI and better product mix. Lighting Division is completely debt free
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Steel and Pipes: Overall degrowth in the volume. Spiral pipes has seen 30% degrowth druing the quarter. ERW pipes volume growth supported the EBIDTA/ton during the quarter. Pending order of 600cr from O&G and export. Export growth of 25% during the quarter.
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EBIDTA/ton: 6100+ for the quarter supported by ERW and export. Export EBIDTA/ton is 9000-10000. Target to increase export from current<20% to 25%.
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Future Guidance : FY24 revenue 7800-8000 cr and FY25 revenue 9500. Steel volume growth 15% and lighting growth by 15%. Sustainable ebdita/ton will be 5500-6000. Lighting Division EBIDTA expected to grow at 20% in FY25.
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Future Gowth Drivers: Company is working on ~20% expansion in existing capacity. New project in western india with capex of 250-300Cr. Announcement after next board meeting.
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Debt: Company will be Debt free by FY24 end one year ahead of the target set by the company
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Demerger: Board will think abt it at appropriate time.
Nothing as such in the results and commentary which justifies yesterday’s price action. Two misses are no timeline for the demerger and no dividend. Street might be expecting from big announcement on this as it was said earlier due to golden Jubilee year of the company. Management is conservative and there first target is to make company debt free
Second might be muted results in lighting and consumer segment. In last concall it was told that a lot of revenue is shifted to Q3 due to late festive season.
Anyone tracking might update their views.
Disc: Invested
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