Highlights of the call 

• The net sales grew by 25% to Rs 517.79 crore and net profit was up by 215% to Rs 31.85 crore. Exports grew by 42% at Rs 68.48 crore and contributed 13% of the net revenue. The OPM increased by 203 basis points to 13.73%

• Plywood and allied products sales grew by 11% to Rs 232.51 crore. Plywood production increased by 12% to 8.75 million square meters and average capacity utilizations were 123%. Sales volumes registered a growth of 7% on the back of 12%, 15% and 19% volume increase at the Kriparampur (West Bengal), Pantnagar (Uttarakhand) and Bamanbore (Gujarat) respectively. The average net realization of Plywood improved by 4% to Rs 209. The Operating Margin declined by 226 basis points to 9.06% primarily due to increase in raw material costs due to appreciation of US Dollar and forward cover costs

• Laminates and allied products sales grew by 14% to Rs 177.92 crore. Laminates production increased by 3% to 2.75 million sheets. The average capacity utilization was at 110%. The average realizations of laminate improved by 19% to Rs 570 per sheet, while average realizations of decorative veneers improved by 11% to Rs 750 per sqm. The Operating Margin in improved by 262 basis points to 14.09%.

• The company exports 45% of laminates produced.

• Domestic realization in laminates is up by 12% - 13% which is sustainable while export realization is up by 30% due to currency effect.

• MDF sales increased by 118% to Rs 106.78 crore. MDF production was up by 85% to 43302 Cubic Meters (CBM). Sales volumes registered a growth of 83% to 43471 CBM. The average Capacity Utilization was 96%. The average realizations of MDF improved by 19% to Rs 24559 per CBM. The Operating Margin improved by 981 basis points at 22.73% on the back of improved capacity utilizations and higher realizations.

• In MDF, demand is more than supply which helped its realization to go up, which is sustainable.

• The mgmt said that there is scope for margin to move up in laminates and MDF. Also added that going forward, it sees margin in MDF to go up to 24% before value addition takes place.

• The domestic market of plywood, laminates and veneers are under pressure.

• The subsidiary companies performed satisfactorily and show a top-line growth of 30%.

• There will be Rs 30 – 35 crore of maintenance capex for FY13 and Rs 35 – 40 crore capex for expansion of valued added products in MDF which will be spread over next 8 – 9 months. The company will raise some debt for expansion of value added products in MDF.

• The company's debt has come down from Rs 684 crore as on 31^st March 2012 to Rs 625 crore as on 30^th Sept. 2012.

• In next 12 months, Rs 90 crore of long term debt will be payable.

• The mgmt expects 15% - 18% top-line growth for FY13 without capacity addition, also expects to sustain margin of Q2 for whole year. The mgmt added that in future it can achieve 16% - 17% margin on change in product mix.