Punjab saw 14% decline in sales which resulted in 39% decline in EPS. Demand still is sluggish and they are hoping it to turnaround this year. They have done well on gross margins and have been adding new chemistry capabilities during this downturn. Concall notes below
FY25Q1
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Maintained volumes and marginal decline is due to lower prices. Inventory is still high in the market and demand is sluggish, expect revival by Q3FY25 along with pricing increase
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Maintained 38%+ gross margins despite pricing pressure
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Freight costs increased by 2.5-3 cr.
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Commercialized 2 specialty chemical intermediate products, one shipped in Q4 and other in pilot plant stage. Lalru plant utilization will improve to ~65% in FY25
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Derabassi is at 79% utilization, it can reach 82-85% (so not much headroom)
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Added BASF and a new Japanese client as new customers
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Newer molecules contributing 6-8% of revenues which should increase to 20% in next few years, these are higher priced molecules ($100/kg+). Most products are $150-250/kg priced with 40-80 tons/year demand
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One of expenses and freight costs depressed EBITDA
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New chemistries added: Freon reaction, cryogenic reaction, butyl-lithium reaction
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Net working capital: 87 days (reduced from 98 days in Q4)
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FY25 capex: 35-40 cr. maintenance. Will put growth capex after having signed contract
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Current setup can generate 1300-1400 cr. sales
Disclosure: Invested (recently increased position size and bought shares in last-30 days)
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