Key takeaways of the call

Sales for FY21 is expected at 86-87% of last year level. PAT will be equally or closer to last year level. For FY22, expect a sales growth of about 20% from FY21 level.

Pending order as end of Dec 31, 2020 was Rs 2611 crore. In addition the company has an L1 order worth Rs 130 crore for supply of EHV Cables to Delhi Transco and this order was received last week.

Domestic business will reach last year levels in Q4FY21. Similarly exports excluding Dongote will be at last year levels.

To double the capacity of cables the company is to set up a green-field project at an outlay of Rs 175 crore. The plant will have capacity to manufacture LT, HT and EHV cables and the investment will occur over next fiscal.

Lower revenue for Q3FY21 is largely due to reduction in EPC business, which the company is gradually reducing it and limiting it to certain level. Further Q3FY20 and Q4FY20 had the advantage of execution of substantial part of Rs 450 crore Dangote Oil Refinery order.

Domestic sales (both Institution and dealer network) was up by 9% in Q3Fy21. Domestic sales for Q3FY21 and 9mFY21 reached about 90% and 85% of last year levels.

EBITDA margin - Cost optimisation and better product mix drove the EBITDA margin higher in Q3FY21.

Active dealers of the company as end of Dec 2020 stood at about 1645 numbers.

Sales of house wire for the quarter stood at Rs 264 crore, a jump of 18% from Rs 223 crore in corresponding previous period.

Overall house wire (HW) market of the country has registered a growth of about 15% but the company has grew by about 18% in Q3FY21 in HW segment. Of Q3FY21 growth of 18%, half of it at about 50% is price led and balance 50% is volume led.

Expect the company's HW business segment to close Q4FY21 and FY22 with a growth of 20-25% and 30-35% in FY22. Increasing the retail sales team in the branches to have better penetration even in smaller cities.

Sequentially (MoM) the market position is increasing. As well as house wire or institutional sales. Hopeful in q4 to reach 100% level in wire and cable business. However EPC business to have lower sales as the company has not booked any fresh orders in the last 1.5 years due to slow recovery in getting money from government customers.

Export sales for the quarter stood at Rs 139 crore compared to Rs 300 crore in Q3Fy20. Lower exports was largely due to reduction/absence of large ticket orders such as Dangote that supported the sales in corresponding previous quarters.

Base export orders except Dangote were about Rs 500 crore annually and that will be maintained around that level.

Able to maintain export orders from existing markets in Australia and MEA as well as some parts of Africa. There is slowdown in economic activity in other markets except Australia. Export outlook will remain weak for next 6 months. The company expect the increase in domestic sales to compensate export shortfall. Once travel resumes the company will expect exports to look up with the company targeting newer markets as well as.

For cables orders it books/orders copper content immediate of receipt of the order or cover or otherwise LME covered or with inventory.

Institutional business of the company has grown in Q3FY21 by about 3%. There are substantial business coming from metro and other infra projects.

Capacity utilisation for cables is about 57-60%; housewire 67%, SS wire 87%.

Market share of the company in EHV segment is 35% of the Indian market.