The company held its conference call on 3 Aug 2018 and was addressed by CFO Mr. Vallinath
Key Highlights
Economic environment is very positive and outlook for rest of the year is positive. Strong visibility exists for next 2 years.
Double digit volume growth for both asbestos cement products and panels business in June 18 quarter. Expected industry to grow by around 5-7%. Ground reality is far better. The company grew by 10% in volume terms in asbestos segment. Volume should continue grow in double digits for rest of the year.
Margins should continue to remain around current level. The Haryana facility should aid further improvement in margins.
Expects double digit top line growth in spinning segment. Most of the problems relating to GST for spinning sector are sorted out. Margins should also recover going forward.
Boards capacity at Haryana and Atum plant is ready and both should commercialize from Sep 18 onwards.
Rs 4.5 crore is some insurance income included in other income. However around Rs 5 crore worth of onetime expense also included in other expenses.
The company can produce total building product of around 8.3 lakh tons is a year.
Boards and Panels grew by 14% domestically. Exports continue to play spoil sport and overall growth was restricted to 9%. Confident of 18% growth in boards and panels by end of FY 19 on YoY basis. FY 18 saw boards and panels sale of Rs 150 crore.
Current margins in boards and Panels are in single digit. High pulp prices and lot of marketing activities have restricted the margins. However margins should increase going forward with some price increases, higher volumes and benefits of low freight post commercialization of Haryana plant.
Rs 200 crore is total debt as on June 18.
Not worried much of rupee deprecation. Total import content in total sales is around 14%. So not worried unless significant rupee depreciation happens from here on.
Expects revenue of around Rs 20 crore from Atum plant in FY 19 and around Rs 65 crore in FY 20.
In FY 19, no major capex is planned and cash flows are expected to improve which will bring down net debt in FY 19.
Increase in Rural spending will auger well for the industry and for the company.
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