Transpek did FY24 revenue of 605cr with EBITDA of 108 cr at 18%. Degrowth in FY24 was led by volume decline and low price to some extent. Management expects modest revival in H2FY25 and guided for near to double digit growth for FY25. Notes from Q4 call:
Fy 24 was challenging to the industry due to global destocking, slow demand from end customers and pricing pressure, China impact and red sea crisis in the late half.
Overall market structure/end uses are not changing but customers are taking a cautious approach in placing orders. Polymer industry (which contributes major revenue) customers and are expanding capacities and Transpek products are used in high end aramid fibers where China is not active.
During the last 3-4 years we have developed 5 to 6 new acid chloride products. These products can reach 100 Cr over 2-3 yrs.
Non acid chlorides(3-4 products) : going through validation by end customers followed by performance testing. So these products will take 3-5 yrs. These are high margin products and the target is to reach 30-35% of revenue from this segment. Once we achieve 30% of revenue these products’ margins will be 20-23%. Potential for these products together is 200cr.
Our products go into critical applications like medicines, critical applications polymers like defense/fire fighting. Validation of these products from customers and regulators takes time.
Started supplying new acid chlorides to korea which has good potential.
New product pipeline in R&D is quite robust.
Capex for 3-4 new products will be based on demand from customers. Company is looking to acquire small facilities or job work rather than greenfield expansion.
Current capacity can do peak revenue of 900cr. FY24 utilization at 68% and expecting to reach 78% for FY25.
Discl: tracking
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