Iron & Steel products company Surya Roshni announced Q1FY25 results: EBITDA increased by 36% YoY to Rs 159 crore in Q1FY25 EBITDA per ton for the Steel Pipe and Strips segment rose by 38% YoY to Rs 6,065 Fan business recorded a 43% volume growth in Q1FY25 due to strong market penetration Professional Lighting business saw a 18% growth driven by infrastructure projects Appliances segment witnessed a 15% volume growth in Q1FY25 Commenting on the results, Company’s Managing Director, Raju Bista, said “We are pleased to report a very healthy operating performance for Q1FY25, despite the slowdown on account of general elections. Our continuous focus on value-added products in the steel pipes segment and innovative offerings in the lighting & consumer durables division have been the key drivers of this growth. EBITDA for Q1FY25 stood at Rs 159 crore, up by 36%, as compared to Rs 116 crore last year. The EBITDA margins improved by 217 basis points to 8.37% on account of significant improvement in operating profitability of steel pipes business and stability in the margins of lighting and consumer durable business. We registered 56% growth in PAT at Rs 92 crore in Q1FY25 versus Rs 59 crore in the same period last year.” “In Lighting and Consumer Durables, we exhibited a steady growth of 3% in Q1FY25. This performance reflects positive outcomes across various sub-segments. The EBITDA margin for Q1FY25 was recorded at 9%. In professional lighting, we achieved a substantial growth of 18%, driven by strong performance in street lighting, industry lighting, and façade lighting. Although the consumer lighting business faced challenges due to ongoing price erosion, there was double-digit volume growth in most sub-categories. Despite short-term price deflation, the volume growth and introduction of value-added products are expected to ensure revenue and profitability growth in the lighting business. The appliance segment witnessed a volume growth of 15%, with significant contributions from the induction cooktops and mixer grinders, particularly in semi-urban and rural markets. Fans business registered an impressive volume growth of 43%, supported by the hot summer season and the introduction of new products in Q4FY24. Enhanced market penetration and improved margins in the fans category further contributed to this growth. We anticipate a revenue growth of 12% to 15% for FY25, driven by aspiring consumers, government focus on infrastructure, and industrial capex. We also remain confident in achieving an EBITDA of Rs 180 crore for FY25, focusing on high-margin products, cost management, and leveraging backward integration with Production Linked Incentive (PLI) benefits. We are focusing on expanding our presence in semi-urban and rural areas, which have shown significant growth potential. While maintaining a strong presence in Tier 2 and Tier 3 cities, we also continue to strengthen our foothold in metro markets. We have tailored strategies for different tiers to promote high-margin products in strong markets and enhance distribution in areas with lower market share We anticipate that the lighting and consumer durables industry will maintain its growth trajectory. This growth will be fueled by the rising aspirations of consumers and increased government investment in infrastructure. Our robust presence in both B2C and B2B segments, coupled with our unwavering commitment to delivering top-notch, cutting-edge products, positions us favorably to seize these opportunities. We anticipate that our continued focus on technology and product development, as well as our strategic market expansions, will lead to consistent growth and profitability in the coming fiscal years.” Adding further, Vinay Surya – Managing Director said, “In Lighting and Consumer Durables, we recorded a growth of 3% in Q1FY25. Almost all business segments registered double-digit volume growth. The gross margins expanded across most segments due to a better margin mix and effective cost management strategies. High-capacity utilization at our manufacturing plants, has positively impacted EBITDA through better operational efficiency. There is a growing preference for energy-efficient, high-quality, and aesthetically pleasing products among consumers. To cater to this demand, we introduced higher wattage and more efficient Platina LED lamps, a range of downlighters(Shine Nxt), and new generation flood lights for consumer lighting applications. We also launched energy-efficient and decorative ceiling and table pedestal wall fans, including starlabelled models. Increase in the number of distributors, particularly in the fan category, over the past year has significantly contributed to the impressive growth in this category in Q1FY25. We have also for the first time, started manufacturing of ventilation fans at our Kashipur facility. We also expanded into the induction cooktops and mixer grinders segment, with a special focus on high-performance commercial mixer grinders. In professional lighting, we have started focusing on indoor lighting and solar lighting to capitalize on growth opportunities. We also launched higher performance streetlights, offering a smart value proposition with lower cost of ownership. We have entered in new product segment of Mono Block Residential Pumps via launch of ‘Surya Water Pumps’ in the month of July 2024. The market size for such pumps is Rs 1,000 crore and is growing fast driven by 'Har Ghar Nal Se Jal' scheme of Government of India. Our comprehensive go-to-market (GTM) strategy includes leveraging existing distribution channels and exploring new avenues to reach consumers. We employ multiple GTM approaches to cater to different product categories, ensuring effective reach and penetration across various market segments. We recognize the critical role that the in-shop experience plays in influencing consumer perceptions and driving sales. Over the quarters, we have intensified our efforts to enhance the in-shop experience across our retail outlets. We see it as a crucial component of our marketing strategy, contributing to the overall performance and growth of the company. Strategic display of our products at over 2,000 retail points ensures high visibility and availability of our offerings. We also have regular engagement exercises with retailers across different parts of the country to strengthen relationships and ensure product availability. These initiatives have already shown positive results, with marked improvements in customer satisfaction and increased sales. We have also implemented significant training programs to ensure that all team members and staff can now provide deep product insights, demonstrations, and personalized suggestions, making every client engagement more informative and engaging. Our regular interactions with electricians and other influencers also enable us to drive brand loyalty and encourage product recommendations. We are confident in our ability to navigate the obstacles and seize the opportunities that lie ahead. Our strategic efforts are linked with client needs, ensuring that we are well-positioned to continue growing and succeed in the lighting and consumer durables industry.” Commenting on the financial performance, Bharat Bhushan Singal – CFO said, “For the quarter, the revenue was Rs 1,893 crore as compared to Rs 1,875 crore. EBITDA and PAT stood at Rs 159 crore and Rs 92 crore as compared to Rs 116 crore and Rs 59 crore, registering a growth of 36% and 56% YoY respectively In Lighting & Consumer Durables, for the quarter, the revenue stood at Rs 385 crore as against Rs 374 crore. EBITDA and PBT stood at Rs 35 crore and Rs 26 crore, registering a growth of 5% and 1% YoY respectively. In the Steel Pipes and Strips, during Q1FY25, the revenue was Rs 1,509 crore as compared to Rs 1,503 crore. Similarly, EBITDA/MT stood at Rs 6,065 compared to Rs 4,388, registering a growth of 38% YoY. EBITDA and PBT stood at Rs 124 crore and Rs 97 crore as against Rs 83 crore and Rs 55 crore, registering a growth of 49% and 76% YoY respectively. Improved capacity utilization, working capital optimization and cost rationalization enabled us to become a zero-debt company, and having cash surplus of Rs 156 crore in Q1FY25. As on 30th June 2024, ROCE stood at 22.93% and ROE stood at 16.71%. As on 30th June 2024, the net working capital days stood at 67 days, inventory days stood at 51 days, debtor days stood at 38 days and creditor days stood at 23 days.” Result PDF
Conference Call with Surya Roshni Management and Analysts on Q4FY24 Performance and Outlook. Listen to the full earnings transcript. Management in attendance
Iron & Steel Products company Surya Roshni announced Q4FY24 & FY24 results: Q4FY24 Financial Highlights: The company reported slight dip in revenue by 2% & EBITDA by 5% in FY24 on account of significant headwinds. EBITDA margins for Q4FY24 stood at 8.30%. Strong volume growth coupled with better product-mix in favor of higher margin value products and cost savings on back of PLI led backward integration resulted in strong operating profitability. EBITDA margins for Q4FY24 stood at 10.66% as against 9.84% for the same quarter last year. Professional lighting business has witnessed high-teen digit growth in Q4. Led Batten & LED Downlighter verticals saw healthy volume growth in FY24. In Q4FY24, the fan business recorded mid-teens growth, while the appliances segment grew by robust 20%. Net Working Capital: 76 days in Q4FY24 as against 70 days in Q3FY24. In Q4FY24, the steel pipes segment recorded its highest ever quarterly volumes of 2.36 lakh tons and witnessed a volume growth of 4%. Despite significant reduction in steel prices in Q4FY24, we witnessed only a slight dip in our overall sales revenue. EBITDA/Ton for the quarter stood at Rs 5,877. FY24 Financial Highlights: We are now a Zero-debt company. We reduced our debt by Rs 400 crore in FY24 and have cash surplus of Rs 65 crore. Inspite of significant price erosion in consumer lighting business, we recorded an annual revenue growth of 2% and stands at Rs 1,572 crore in FY24. Professional lighting business witnessed more than 20% growth in FY24 driven by infrastructure as well as industrial projects. In FY24, the fan business recorded mid-teens growth, while the appliances segment grew by robust 20%. Net Working Capital: 55 days in Q4FY24 as against 69 days in Q3FY24. Growth of 6% in FY24 inspite of the B2B business witnessing a temporary slowdown on account of General Elections. Exports registered a volume growth of 12% in FY24. Strong in-hand order book of Rs 800 crore as on 31st March 2024 for Oil & Gas sector, Water Sector and Exports business. Commenting on the results, Company’s Managing Director, Raju Bista, said “The overall performance of the company in FY24 has been satisfactory given the headwinds in both our business verticals of Steel Pipe business & Lighting and Consumer Durable business. We firmly believe that these headwinds are temporary, and the company is poised for sustained growth in both the businesses. EBITDA for FY24 stood at Rs 586 crore as compared to Rs 620 crore last year. There was slight dip in our overall EBITDA margins primarily on account of significant dip in operating margin of steel pipes business which was slightly offset by improved margins in lighting and consumer durable business. We registered PAT of Rs 329 crore in FY24, similar to what we had recorded in FY23.” “In Lighting and Consumer Durables, we experienced good results in FY24. Overall sales witnessed a growth of 2% and EBITDA increased by 23% in FY24 as compared to previous year, signaling improved operational efficiency and effective cost management. Our professional lighting segment notably grew in Q4FY24 by approximately 20%, demonstrating strong market acceptance and a robust order book. Consumer durables, including fans, water heaters, irons, kitchen appliances, and festival lighting products, all posted double-digit growth, reflecting high consumer satisfaction and market penetration. Throughout the year, our focus on design quality and manufacturing excellence has significantly reduced warranty related costs for LED products, placing us at the forefront of industry standards. Both lighting plants met productivity targets, benefiting from numerous automation and process improvement projects. This focus on operational efficiency not only enhanced our performance metrics but also supported our profitability, with EBITDA margins improving from 7.9% to 9.6% over the fiscal year. Despite a challenging market environment with subdued demand for consumer durable products in the last quarter, our engagement strategies with over 25,000 key retailers and innovative marketing activations have kept our brand highly visible and competitive. The introduction of new product lines, particularly in the premium category, has successfully enriched our product mix, further bolstering our market standing. Looking forward, we expect the lighting and consumer durables industry to continue experiencing growth, driven by increasing consumer aspirations and government spending on infrastructure. Our strong position in both B2C and B2B segments, along with our focus on high-quality, innovative products, positions us well to capitalize on these opportunities. Our ongoing investments in technology and product development, along with strategic market expansions, are expected to drive sustained growth and profitability in the upcoming fiscal years.” “In the Steel Pipes and Strips, the company achieved the highest ever quarterly volumes despite challenging market conditions and electoral season. However, the company demonstrated resilience, managing only a slight dip in sales revenues due to decline in steel prices. This success is attributed to our strong presence in the API pipes segment and robust export performance, which collectively constituted 29% of our total volume sales. The downturn in steel prices led to an EBITDA/Ton of Rs5,877, on account of muted value-added product sales & loss in inventory. The current Government’s 2024 manifesto has given a lot of impetus to infrastructure projects which includes overbridges, new airports and railway station redevelopment. The designs of these projects are such that it will generate robust demand for DFT pipes. The manifesto also includes a promise to expand city gas distribution (CGD) networks across India, which will drive growth. We also expect healthy volume growth in API pipes business as well. We also supply GI section pipes to solar utility projects, which are likely to witness rampant installation over the upcoming years. We are actively expanding our operational capacity - aimed at increasing our monthly production capacity by 12,000 to 15,000 tons - to meet anticipated market demand. These expansions will enhance our ability to serve growing market needs, particularly in water infrastructure and energy sectors. With steel prices stabilizing and the government’s increased focus on infrastructure development, we expect healthy demand across our product lines. Our strong order book of Rs800 crore, particularly in the oil & gas and water sectors, along with a solid export portfolio, underscores the company's robust financial health and operational efficiency. Improved working capital cycles and strategic raw material sourcing further strengthen our market position. We will continue to innovate, adapt, and grow, driven by a commitment to excellence and sustainability.” Result PDF
Iron & Steel Products company Surya Roshni announced Q3FY24 & 9MFY24 results: Consolidated Q3FY24: Revenue: Rs 1,938 crore, down by 4% compared to Q3FY23. EBITDA: Rs 158 crore, a decrease of 3% from Q3FY23. EBITDA margins for Q3FY24 stood at 8.2% as against 8.1% for the same quarter last year Profit Before Tax (PBT): Rs 121 crore, a slight decrease of 1% from Q3FY23. Profit After Tax (PAT): Rs 90 crore, remained unchanged from Q3FY23. Consolidated 9MFY24: Revenue: Rs 5,729 crore, down by 2% compared to 9MFY23. EBITDA: Rs 414 crore, a growth of 13% from 9MFY23. Profit Before Tax (PBT): Rs 306 crore, a significant increase of 25% from 9MFY23. Profit After Tax (PAT): Rs 225 crore, a notable increase of 25% from 9MFY23. Commenting on the results, Company’s Managing Director, Raju Bista, said, “On sequential basis, the overall performance of the company has been satisfactory given the volume de-growth witnessed in Q3FY24. This demonstrates the company’s ability to withstand economic headwinds. EBITDA for Q3FY24 stood at Rs 158 crore as compared to Rs 164 crore in the same quarter last year. We were able to sustain our overall EBITDA margins primarily on account of significant improvement in lighting and consumer durable business. We registered PAT of Rs 90 crore in Q3FY24, similar to what we had recorded in Q3FY23. However, on sequential basis, EBITDA, PBT, and PAT witnessed a growth of 14%, 16%, and 19% respectively. We firmly believe that these headwinds are temporary, and the company is poised for sustained growth in both businesses." Result PDF