Key highlights

In CY 2017, the focus was on cash generation and cash inflows which stood at Rs 79.38 crore as compared to Rs 48.61 crore for CY 16.

Margins were lower as there were less of consumables sales, which have high margins, due to lower demand and consumption from metal industry. Also there was a time gap between raw material increase and passing on to the consumers in a scenario of lower demand and industry hit by GST and demonetisation.

Value growth in sales was around 5% while volume was around 8% in CY 17.

Consumables and high value added products has Ebidta margin of around 18-20% which generally results in overall higher margins for the company.

Overall sales and offtake is picking up gradually. Sale of high value added products should also pick up as the year progresses which should help margins.

Net sales should grow in double digits in CY 18 driven by Railways, metallurgy, automobiles, capital goods, ferrous and non ferrous industries, speciality chemical segment etc.

Company continues to operate at around 70-75% of installed capacity since past 2 years now. No major capex is aimed going forward. Expects capacity utilization to improve in CY 18.

Automobile industry continues to do well and company has good market share in M&H CV segment. But the business is more of volume than of value. Higher margins arise from general engineering, heavy engineering, construction and speciality segment.

New products were introduced in CY 17, but overall demand was lower so didn't made an impact on overall sales in CY 17. These products should do well in CY 18.

While management is not bullish for CY 18, expects CY 18 to be a strong base year which should see higher volumes, high value added products and new products acceptability in the market and higher capacity utilization.

There are no plans for higher exports and Parent doesn't see the subsidiary as a hub for export markets.