IKIO Lighting –
Q1 FY 25 concall and results highlights –
Sales – 127 vs 108 cr
EBITDA – 17 vs 23 cr ( margins @ 13 vs 21 pc )
PAT – 12 vs 14 cr
Completed Block -1 of Greenfield expansion of 2 lakh sq ft in Q4 FY 24. Commercialised the same in May 24. Expected to complete Block – 2 of another 2 lakh sq ft by Mar 25. Have started construction for block -3 of another 1 lakh sq ft. Combined capex spend for all three blocks is around 200 cr with a total yearly revenue potential of 1000 cr ( incremental. It may take 3-4 yrs to reach optimum capacity utilisation for all 3 blocks )
ODM Listing segment grew both on YoY and QoQ basis. Performance in domestic mkt was flat. Export sales were aided by exports to Gulf region, inventory reduction in US for company’s RV products
EBITDA margins impacted due to front loading of expenses like higher employee expenses ( up 40 pc YoY ) due completion of new Greenfield Capex. Expect significant contribution from this facility in H2. This facility is also producing 2 new products – earphones of various kinds and smart watches
In addition to RV business in US, have started supplying Industrial and Solar products to energy service companies in US
Gross margins were stable Ex-US operations. As US operations stabilise, expect gross margins to normalise going fwd
Company maintains FY 25 guidance of 20-25 pc revenue growth for FY 25 with EBITDA margins ranging between 20-22 pc !!!
Company has already started backward integrating the wearables and hearables segments. Company is also looking at the design aspects in these segments. Aim is to keep the RoCE high, even if there is some margin dilution
Seeing descent pickup in the LED lighting industry in FY 25 after a difficult FY 24
Company believes that they are an electronics manufacturing and design company at heart. Lighting is the biggest chunk of their business – that’s a different matter. It’s their electronics manufacturing and design DNA that makes them confident of venturing into wearables and hearables. Anything to do with – plastics + metals + electronics – they r good at it and they r capable of doing it in-house
Disc: hold a small tracking position, biased, not SEBI registered, not a buy/sell recommendation
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