Srikalahasthi Pipes Ltd (SPL) registered strong revenue growth of 28.6% YoY in Q2FY19, largely driven by volumes. However, EBITDA and PAT declined by 15% & 10.5% respectively, which was disappointing and significantly below our estimates. Impacted by muted realizations, input cost inflation and rupee depreciation, EBITDA margins contracted sharply by 657bps YoY to 12.8%.

Srikalahasthi Pipes Ltd. (SPL) one of the leading manufacturers of DI pipes in India, reported its Q4 FY18 numbers, which was below our expectations. The company reported a bottom-line of Rs. 343.3mn (growth of 10% Y-o-Y) on a...

Srikalahasthi Pipes Ltds (SPL) Q4FY18 numbers (YoY) were below our estimates on all parameters. Net revenue declined by 21.5%, impacted by lower realization in DI pipes and absence of trading sales during the quarter. EBITDA de-grew marginally by 2.8% YoY, while PAT grew by 10% YoY.

Valuation: We estimate SPL's total operating income to grow at 14.5% CAGR over FY17-20 to Rs. 18,066.4mn, while EBITDA and PAT to grow at 18.3% and 20.8% CAGR, respectively, over the same period to Rs. 3,922.7mn and Rs. 2,470.8mn. Based on EV/EBITDA multiple of 5.8x to FY20E EBITDA, we arrive at a target price of Rs. 393 per share, translating into a potential gain of 13.2%....

Srikalahasthi Pipes Ltds (SPL) Q3FY18 numbers (YoY) were marginally below our estimates. While net revenue increased by 32.4%, PAT declined marginally by 1.6%. Impacted by higher input cost, the EBITDA margins contracted 879bps YoY to 15.4%.

Srikalahasthi Pipes Ltd (SPL) reported encouraging numbers for Q2FY18 with Net Revenue and PAT growth of 94.6% & 43.1% YoY, in line with our estimates. Led by higher input prices, EBITDA margins contracted 91bps YoY to 19.4%.

Srikalahasthi Pipes (SPL) has delivered a subdued performance in 2QFY18. While the numbers look encouraging on YoY basis, but the same is not comparable as SPL undertook a planned maintenance shutdown of its mini blast furnace in 2QFY17 for about 30days. Hence, while its revenue surged by 95% YoY, it fell by 21.4% QoQ to Rs3.4bn (vs. our estimate Rs4.59bn). EBITDA increased by 86% YoY (+2.5% QoQ) to Rs659mn vs. our estimate Rs767mn. Though EBITDA margin contracted by 91bps YoY, it surged by 452bps QoQ to 19.4% (vs. our estimate of 16.7%) owing to softening of coking coal prices during the quarter. Notably, EBITDA sharply declined in 1QFY18 due to a steep rise in prices of key raw material i.e. coking coal, which rose to...

Srikalahasthi Pipes Ltd. (SPL) one of the leading manufacturers of DI pipes in India, reported a mixed set of numbers for Q1 FY18. It reported a 53.7% Y-o-Y rise in the revenue to Rs. 4,404.9mn, while there was a sharp contraction in...

Srikalahasthi Pipes Ltd (SPL) reported in-line numbers on the profit front with 14.7% & 15.2% YoY de-growth in EBITDA and PAT. However, revenue growth of 55.1% YoY was impressive and significantly above our estimates.

Looking ahead, we expect SPL's operating performance to improve, as the price of coking coal is expected to stabilise from 2HFY18E onwards. Moreover, the government's thrust on improving water infrastructure through multiple schemes offers greater order inflow visibility for SPL. Further, ~75% market share in Southern & Western markets augurs well for SPL, as the industry enjoys strong entry barriers for being capital intensive having long gestation period. Thus, we maintain...

Incorporated in 1991, Srikalahasthi Pipes Ltd. (SPL; erstwhile Lanco Industries Ltd.) is one of the leading producers of ductile iron (DI) pipes in India. With a production capacity of 3 lac TPA of DI pipes, SPL's facility is located at Tirupathi (AP). SPL also manufactures pig iron, cement, low ash metallurgical coke & generates power for captive consumption.

Bleak Quarter Marred by Higher Input Cost; Maintain BUY Srikalahasthi Pipes (SPL) has delivered a subdued performance in 4QFY17 with its EBITDA declining by 16.1% YoY and 13.8% QoQ to Rs556mn (vs. our estimate Rs 722mn), while EBITDA margins contracted by 902bps YoY and 1,133bps QoQ to 12.9% vs. our estimate of 21.6%. Sharp decline in EBITDA is attributable to a steep increase in the prices of key raw material i.e. coking coal, which averaged at US$220/tonne in 4QFY17 compared to US$170/tonne and US$105/ tonne in 3QFY17 and 2QFY17, respectively. Notably, SPL could not pass on the higher cost of coking coal to the customers, as the prices increased in every month of the quarter. However,...

Srikalahasthi Pipes Ltd. (SPL) (formerly known as Lanco Industries Ltd.) is one of the leading producer of ductile iron (DI) pipes in India. Incorporated in 1991, the company is currently engaged into the manufacturing of DI pipes, pig iron,...

Srikalahsthi Pipes Ltd (SPL), formerly known as Lanco Industries Ltd, is one of the leading manufacturers of Ductile Iron Pipes (DI Pipes). It was incorporated in 1991 and has its manufacturing facility in Rachagunneri,Chittoor Dist AP. In 2002 it entered into a strategic alliance with Electrosteel castings Ltd (ECL), one of the largest manufacturers of DI pipes. SPL's marquee client list includes L&T;,...

Top-line grew by 36.6% Y-o-Y: In Q4 FY17, SPL reported a 36.6% Y-o-Y rise in the operating revenue to Rs. 4,394mn. The increase in the top-line was mainly attributable to higher realizations and the business from the trading activities. Business from normal activities is anticipated to have increased by around 13% Y-o-Y to Rs. 3,600mn in Q4 FY17. Annually, for FY17, top-line reported a modest rise of 2.2% to Rs. 12,034mn. Higher coking coal price pull down EBITDA by 19.7%: Q4 FY17 quarter was characterized by the higher coking coal prices, which mainly led to a 64.1% Y-oY increase in the cost of material consumed. Consequently, total operating...

Srikalahsthi Pipes Ltd (SPL), formerly known as Lanco Industries Ltd, is one of the leading manufacturers of Ductile Iron Pipes (DI Pipes). It was incorporated in 1991 and has its manufacturing facility in Rachagunneri,Chittoor Dist AP. In 2002 it entered into a strategic alliance with Electrosteel castings Ltd (ECL), one of the largest manufacturers of DI pipes. SPL's marquee client list includes L&T;,...