Capitaline

Analyst Meet / AGM 21-May-21

Conference Call

INEOS Styrolution

Expect decrease in demand of ABS

INEOS Styrolution held a conference call on 20^th May to discuss the results for the quarter and year ended Mar'21 and way forward. Mr. Sanjeev Madan -Whole-time Director & Chief Financial Officer of the company addressed the call.
Highlights of the Concall

Net sales increased 77% YoY and 31% QoQ to Rs 636.5 crore in Q4FY21 while PAT stood at Rs 161.4 crore compared to Rs 4.5 crore. For FY21 revenue was up 3% to Rs 1631.5 crore while PAT stood at Rs 280.2 crore compared to loss of Rs 9.5 crore

Specialties revenue rose 71% YoY and 28% QoQ in Q4FY21 to Rs 447.6 crore while for FY21 it was down 2% to Rs 1147.3 crore. PBIT stood at Rs 176.6 crore in Q4FY21 compared to Rs 13.3 crore in Q4FY20 while for FY21 it was up 904% to Rs 291.5 crore

Polystyrene revenue rose 96% YoY and 40% QoQ in Q4FY21 to Rs 188.9 crore while for FY21 it was up 18% to Rs 484.2 crore. PBIT stood at Rs 43.3 crore in Q4FY21 compared to Rs 6.5 crore in Q4FY20 while for FY21 it was up 614% to Rs 94.1 crore

During the quarter under review, the company operated all its operations at all locations at normal level.

Business continued to grow in Q4 as COVID situation improved during quarter but with second wave of COVID, uncertainty remains on the duration and its impact on Indian economy in Q1 FY21-22.

The company has elected to exercise the option permitted under section under 15BAA of the Income Tax Act 1961 as introduced by the taxation law amendment ordinance 2019. According the company has recognized provision for current tax for the year ended March 31 2021 and re-measured its deferred tax basis the rate described in that section. The full impact of this change has been recognized in the financial results for the quarter ended December 31 2020.

High market prices and strong margins resulted in improved business performance. The company does not see any pressure in margins currently.

The company expects some impact in its volumes in Q1FY21 due to second wave of Covid as most of the sales of white goods, automotives and all types of plastics (except packaging) has been affected.

India is a net importer of ABS.

The company expects the ABS and styrene market to get long sometime this year meaning the demand of ABS would decrease led by decline in China.

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