Powered by: Motilal Oswal
5/08/2022 4:58:30 PM | Source: Motilal Oswal Financial Services
Update On Balkrishna Industries Ltd By Motilal Oswal Financial Services
News By Tags | #2486 #5211 #4315 #3062
Update On Balkrishna Industries Ltd By Motilal Oswal Financial Services

Revenue beat driven by strong volume growth

Higher RM and freight costs drag margin

* Volumes grew 21% YoY to 83.15k tonne (est. 77.5k tonne).

* Realizations grew 23% YoY to INR327.9k/unit (est. INR318.5k).

* Revenue grew 49% YoY to INR27.3b (est. INR24.7b).

*  Gross margin contracted by 3.8pp YoY and 1.2pp QoQ to 46.6% (est. 46%) due to RM cost inflation. RM costs are expected to cool down in 4QFY23.

*  EBIDTA margin declined by 9.2pp YoY to 19.6% due to higher RM costs and other expenses (freight costs rose 7.2pp as a percentage of sales). EBIDTA grew 1.5% YoY to INR5.35b (est. INR5.4b). Logistic costs are expected to reduce by the end of 3QFY23 or early 4QFY23.

*  Lower other income led to a 11% YoY decline of adjusted PAT to INR3.2b (est. INR3.4b).

* It declared a first interim dividend of INR4/share in FY23.

*  The management expects sluggish demand in 2QFY23 due to macro challenges in Europe, coupled with heat waves and inflationary trends in the US.

*  It has guided at sales volumes of 320,000-330,000MT in FY23.

*  Valuation view: The stock trades at 28.8x/23.6x FY23E/FY24E EPS.

 

To Read Complete Report & Disclaimer Click Here

 

For More Motilal Oswal Securities Ltd Disclaimer http://www.motilaloswal.com/MOSLdisclaimer/disclaimer.html SEBI Registration number is INH000000412

 

Above views are of the author and not of the website kindly read disclaimer

Disclaimer: The content of this article is for informational purposes only and should not be considered financial or investment advice. Investments in financial markets are subject to market risks, and past performance is not indicative of future results. Readers are strongly advised to consult a licensed financial expert or advisor for tailored advice before making any investment decisions. The data and information presented in this article may not be accurate, comprehensive, or up-to-date. Readers should not rely solely on the content of this article for any current or future financial references. To Read Complete Disclaimer Click Here