Mishra Dhatu Nigam conducted conference call on 10 November 2021 to discuss the financial results and performance of the company for the quarter ended September'21. Dr S K Jha - Chairman & Managing Director and Mr. N. Gowri Sankara Rao - Director (Finance) of the company addressed the call

Highlights of the Concall

• The company's operations were impacted by the second wave of the Covid-19 pandemic and the recovery was seen in the later part of the period ended 30th September 2021.

• H1FY22 revenue rose just 9% compared to H1FY21 as the company's product take lot of time for getting converted into sales as it has niche area of its business and lot of processing steps are involved.

• Power and fuel expenses have increased due to increased LPG prices. The trend is expected to continue into Q3FY22. There has been some saving on account of solar power plant commissioned by Midhani in FY21.

• Current order book stands at Rs 1370 crore, of which defence (including sale to PSUs) is around Rs 300 crore, space is around Rs 860 crore and rest is others.

• The company expects around Rs 1000 crore of order inflow for FY22 which includes Rs 150-200 crore of order flows for the wide plate mill, armour facility in Rohtak etc.

• The company expects significant order inflow from defence sector going forward specially linked to missiles. It is also optimistic on Titanium plates order. Also, there is significant effort being put in by ISRO to encourage private sector participation in space launches which can potentially expand the market and help Midhani.

• The company wide plate mill with a capacity of 30000 tonne is at commissioning stage. The project has started contributing to revenues but it is very small as it is at nascent stage. However the initial indicators are very good.

• The company wide plate mill is supplying plates to railways and those plates are used for making LSB coaches in integral coach factory Chennai.

• The company wide plate mill is very versatile and it can roll variety of products right from carbon steel to high end nickel based alloys and titanium alloys. In India it is one of its kind mill.

• The company expects 60-70% capacity utilisation of the plate mill in FY23.

• The company incurs meaningful sub-contracting expenses catering to nuclear reactor orders. With commissioning of the wide plate mill, the same is expected to come down meaningfully

• The company has booked order worth Rs 5 crore for its armour facility. The company expects good business in future from that facility as well.

• The company has developed a special type of steel which is being used for oil and gas industry and is looking for export market as well.

• The company export business is doing quite well and it did its highest ever export in Q2FY22. The company feels that there is good opportunity in the export market. The company expects good growth in export revenues in FY22

• There is significant effort being put in by ISRO to encourage private sector participation in space launches which can potentially expand the market and help Midhani

• The government's direction to float domestic tenders for order value of less than Rs 200 crore is expected to be positive step for the company. This step can unlock revenue potential of around Rs 500-600 crore.

• The company expects capex of Rs 210 crore for FY22.