Govt loses. free market wins!
High grade pellets would be around 10k per ton rate now.
Annual EPS at this rate is around 100 including savings from Solar power plants.
This is today’s update.
GPIL Q2FY23 highlights:
GPIL’s revenues from operations increased by a meagre 2.57% YoY and decreased by 21.56% QoQ to ₹1307.14 Crs, its operating income (EBIT less other incomes) fell to ₹197.19 Crs (-53.97% YoY and -54.46% QoQ) resulting in a 15.09% OPM, its net profits plummeted to ₹168.64 Crs (-42.23% YoY and -48.46% QoQ) meaning a 12.65% NPM.
YoY, the company’s cost of goods sold (71% of the expenses) increased by 41.55%, employee benefit expenses increased by 24.47% and finance costs declined by 76.54% hence, the majority of the fall in profitability seems to be caused by the apparent increase in COGS (caused by volume growth) but the real reason is the fall in the realisation.
The biggest contributors to the decline in cash flows are a decline in operating income, payment of dues to trade payables and other current liabilities and an adverse change in other current assets.
GPIL imported about 150000 MT in Q2 and the average price was about INR18,000 landed to plant.
The company aims to keep its stake in Hira at a similar level but would like to fully acquire Ardent.