PCBL Limited Q1 FY25 Earnings Conference Call Key Takeaways:
Financial Performance :
PCBL Limited achieved record operational and financial performance in Q1 FY25. - Consolidated sales volume (Carbon Black) increased by 25% YoY to 1.54 lakh tonnes. - Consolidated revenue from operations rose by 59% YoY to Rs.2,144 crores. - Consolidated EBITDA grew by 72% YoY to Rs.369 crores. - PAT increased to Rs.118 crores, marking an 8% YoY growth. - Ecoform Q1 FY25 Revenue stood at Rs.359 crores. - Ecoform Q1 FY25 operational EBITDA reached Rs.55 crores. - The current annual revenue run rate has exceeded US$1 billion and is expected to accelerate further.
Operational Performance
PCBL Tamil Nadu achieved a sales volume of 28,228 tonnes. - The new Chennai plant gained approval from all major tire manufacturers in India and reached 85% capacity utilization. - Carbon Black sales volume: 90,438 metric tonnes domestically and 63,480 internationally. - Export sales volume saw a strong growth of 56% YoY in Q1 FY25. - Highest ever power generation and sales volume was recorded, with an average power realization of Rs.4.16 per kilowatt-hour. - The Ecoform business witnessed a steady improvement in performance post-acquisition, with efficiency improvements and cost optimization measures expected to yield positive results.
Future Outlook
Confident in achieving 11.5-12% CAGR volume growth in the Carbon Black business over the next 4-5 years. - Operating margin and EBITDA per tonne are expected to increase over the next five years. - Management sees a strong possibility of EBITDA increasing by Rs.4,500-5,000 per tonne. - Significant growth in international sales volume is anticipated in the next few years, driven by European tire manufacturers increasing sourcing from India. - Expansion of the product portfolio and customer base is also expected.
Capacity Expansion
PCBL Limited is pursuing an aggressive capacity expansion program across different segments. - The Carbon Black capacity is expected to reach 8.8 lakh tonnes, including specialty capacity of 1.12 lakh tonnes. - Power capacity is set to reach 134 megawatts upon completion of expansion. - The Ecoform capacity will be doubled in the next five years across geographies.
Capital Expenditure
Long-term CAPEX will involve adding roughly 4 lakh tonnes of additional carbon black capacity and doubling of Ecoform capacity across geographies. - Total CAPEX is estimated to be roughly Rs.3,300 crores in the next five years.
Debt
The current gross borrowing stands at Rs.4,400 crores, with estimated cash flow in the next five years reaching ~Rs.10,000 crores, which is sufficient to cover CAPEX and repay entire debt.
Other Key Points
PCBL Limited is focusing on R&D for technical advancement and business expansion, with recent patents received for hybrid carbon black grade with graphene. - The company believes that the long-term prospects of all business segments look positive. - Exploration of backward integration for Yellow Phosphorus in the Middle East and other initiatives beyond the current segments are underway.
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