AYM Syntex (was Welspun Syntex)

(khs) #82

FY19 Q2 Results:

(pnt_glt) #83

Duty drawback rate increase to boost textile exports from India

Duty drawback rates have been raised by up to 70 per cent across all varieties of textile value chains

(shikhar mundra) #84

again a set of disappointing results. company talks about spending money into R&D and developing specialised yarn and all but that does not reflect in the results.
Textile industry might be going through a rough phase but even Sarla Performance ( a listed peer) gave 15 % OPM.(DEC quarter)

(vaibhav) #85

Agreed. Disappointing again. Let us hear in concall when the BCF lines are coming onstream.

(Rohit Balakrishnan) #86

Concall Notes Q3 FY19

  • Almost all the capex is done now and the company is at peak debt. Expect debt to be reduced from FY20 onwards. 40-50 Crores of repayment of debt can be expected. No new capex to be done now. Maintenance capex is 5 Crores and another 5 Crores maybe invested opportunistically. In terms of comfortable debt levels- Debt/EBITDA of 2-3x is a comfortable level.

  • Volumes in this quarter were lower, however things have begun to improve. Increase in volumes is a major focus for the company. The volume increase will be driven by the recent capacity increase in BCF, new products, Improvement in Palghar and also to some extent in the nylon polyester segment. The capacity increase in BCF is ~ 60% - of this 60% - half of it is mono colour which is what they have been doing so far. The other half is tri colour , which they are still trying to get new customers to sign up for. Confident that they will be able to utilize the majority of the expanded capacity in this FY

  • This quarter the company saw some inventory losses.

  • Margin levers - Volume increase, Change in product mix, Cost reduction and productivity improvements and reduction in some of the costs which have shot to unsustainable levels.

  • Seeing good traction in the new product segments - industrial, auto, these are doing volumes of 100/tonnes per month. However still very low in terms of overall contribution

  • First focus of the company is to get to double digit margins in terms of EBITDA.

(vaibhav) #87
  1. The co. Will try to hit 10% ebidta Margins in 3 quarters… meaning by q2 fy20.

  2. Promoter may convert the warrants which will give arnd 35 crs. (He says he hasn’t given it a thought as conversion deadline may still be some time away)…so, assuming the co. Maintains same cash levels n uses warrant money also to pay back say 50cr. debt , the cash profit generated for FY 20 may be 15 cr (is that a fair assumption?)…as also 10% ebidta Margins will be hit only by q2 fy20.
    Edit: this is wrong actually. 40-50cr. Debt they can pay off through internal accruals since depreciation is a non-cash item.

Disclosure: invested.

(vaibhav) #88
  1. BCF capacity increased by 60%. Asset turnover of 1.8 iirc over CapEx of 60 cr iirc , meaning 110 cr. Of Annual new capacity in BCF. Also meaning existing BCF was 110/0.6 = 180cr. Of 950cr. Annual Revenue (assuming BCF lines were used at 100% utilisations)

  2. If we work with 1000 cr. Revenue , 10% margins n 75 cr annual out-go for interest plus depreciation , we get to 25 cr. PBT.

(pnt_glt) #89