Capitaline

Analyst Meet / AGM 20-May-21

Conference Call

EPL

Confident of sustaining double digit revenue growth

EPL conducted conference call on 20^th May 2021 to discuss the financial results and performance of the company for the quarter and year ended Mar'21. Mr. Sudhanshu Vats – MD & CEO, Mr. M.R. Ramasamy – COO and Mr. Parag Shah- CFO of the company addressed the cal
Highlights of the Concall

The company reported a double digit revenue gowth in FY21 with high teen PAT growth while RoCE improved by 290 bps to 21.3%

EBITDA growth lower than revenue growth in Q4FY21 because of steep increase in raw material prices, time lag in recoveries and Covid-19 related one-time operational expenses.

The company saw unprecedented raw material price increase of around 25% compared to previous quarter as against historical movement in the broad band of +/-5%

The company acquisition of Creative Stylo Packs Private Limited (CSPL) will help EPL further strengthen its position in the in beauty and cosmetic segment. It is also revenue and Ebitda accretive.

All plants are currently operational.

Product innovation extended to launch hand washes in tubes. The company is envisioning becoming a large player in hand wash category going forward.

Personal Care Contribution stood at 46% in FY21 compared to 45% in FY20, 43% in FY19 and 41% in FY18

Personal Care contribution declined to 49.2% in FY21 in AMESA (Africa, Middle East and South Asia) against 49.9% in FY20 due to sluggish demand in B&C (beauty and cosmetics) on account of ongoing Covid-19 outbreak. However B&C has recovered in the second half. Timely innovation and launch of Hygiene products aided in boosting the FY21 performance

Personal Care contribution in EAP (East Asia Pacific) increased to 40.4% in FY21 against 34.5% in FY20. Growth is majorly driven by B&C and Pharma segments. Strong business pipeline and increased focus on fast-growing regional players has driven robust growth in FY21.

Personal Care contribution in Americas is maintained at 25% in FY21 against 25.4% in FY20. The company has won new customers across categories. The company is cross-selling personal care products to existing oral care customers

Personal Care contribution in Europe increased to 65.2% in FY21 against 64% in FY20. The company won strong new customer across Personal Care categories while it also has robust business development pipeline

EPL has established global leadership in oral care with the segment demonstrating steady long-term revenue growth at a CAGR of 10.0%

The company has a three month contract to pass through increase in raw material cost with majority of its customers. And this timeline in a very sharp price increase scenario puts pressure on the margin in the interim period

The company is very confident of sustaining double digit revenue growth going forward indicated by 29% increase in business development pipeline at the beginning of FY22 compared to FY21

The company plans to deliver quarter on quarter improvement in margins through judicious price increases, cost productivity initiatives and mix improvement.

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