Key Highlights

Management highlighted that Ebidta margin should be seen more from an annual prospective. So in FY 19, Dec 18 quarter had seen abnormal margins and in FY 18, Mar 18 quarter had seen abnormal margins. On an annualized basis, the Ebidta margin improvement is in line with management's expectations.

For FY 19 Ebidta margin stood at 12.8% and for FY 18 it stood at 11.7%. Margins improved due to better product mix, leverage of sales on existing network and forex benefits. Broad range of Ebidta margin is around 11.5-13% to remain going forward.

Net sales growth of 18% for FY 19, was led by a 11% growth in wires and cables business which accounted for 86% of total revenues, Fast moving electrical goods (FMEG) grew by 33% and now accounted for 8% of total sales while the other segment mainly consisting of EPC business grew by 86% and accounted for 6% of total revenues.

In Mar 18 quarter, in FMEG business there was a Rs 35 crore of supply for street lighting which stood at around Rs 5 crore in Mar 19. So excluding this, the overall growth in FMEG segment which looks flat otherwise, has grown by more than 20% YoY.

Certain closure of orders in EPC business led to jump in EPC revenues in FY 19 which increased by 86% to Rs 463 crore.

Order book in EPC stands at around Rs 200 crore. It's a tactical business for the company. Expects business to remain at around Rs 200-400 crore only.

The company has a 18% market share in wires and cables business. Demand condition in wires saw some slowdown in April and May 19, may be largely due to elections. Also working capital got stretched during this period. Expects post election market should come back and do well.

Rs 275 crore of capex in FY 19. Rs 200 crore of capex for FY 20. 67% of capex will be towards wires and cables and rest towards FMEG segment.