Sales growth was subdued due to Chinese lockdown, supplies have already started reviving in July. Company faced pressure on gross margins and on power and fuel. Concall notes below.
Guidance: Lower sales growth to 15-17% (vs 18-20% earlier) with 16-18% EBITDA margins (vs 18-20% earlier). There was decline in exports to China due to lockdown, which should recover in next 2 quarters. Already have seen strong recovery in July and August
- On annualized basis, 12% of sales are from China
- Gross margins of 32% should increase going forward
- Expecting 25 cr. of revenues in FY23 from Mikusu India Private Limited and 75 cr.+ in FY24. Currently setting up dealer network
- Power & fuel costs are around 5 cr. per month
Capex:
- First block of Sarigam facility will come onstream in Q4FY23, there are 5 molecules that should be launched from this facility
- Planned capex of 130 cr. in FY23 + 120 cr. in FY24 (250 cr. in next 2-years)
- On newer capex, expect 3.5-4x fixed asset turns
Pyrethroid
- Top 3 molecules account for 30-35% of sales
- Total contribution from pyrethroids are 57-58% of sales
- Regulated markets
- Generally markets open in Q3 and Q4 of fiscal years
- Will get to know about new order to USA in Q3, have sent trial batches
- Have not been able to get business in Europe due to travel restrictions
R&D
- 2 planned launches in FY23, 1 has been launched and 1 will be launched
- 5 out of 15 products are in registration phase
Disclosure: Invested (position size here, no transactions in last-30 days)