Ranvir's Portfolio

Q&A: Questions & Answers Portfolio Q&A
1439

Zydus Lifesciences -

Q3 FY 25 Results and Concall highlights -

Q3 financial outcomes -

Revenues - 5269 cr, up 17 pc YoY
Gross Margins @ 69.9 vs 67.4 pc
EBITDA - 1387 cr, up 26 pc YoY ( margins @ 26.3 vs 24.5 pc YoY )
PAT - 1023 cr, up 30 pc YoY

R&D expenses @ 503 vs 314 cr ( @ 9.5 pc of sales - very healthy levels )

Capex in last 3 Qtrs @ 290, 301, 302 cr

Cash on books @ 3091 cr
WC @ 6058 cr

Geography wise performance -

India Formulations - 1498 cr, up 5 pc YoY ( @ 29 pc of company sales ). YTD, India sales grew by 9 pc. Company gained mkt share in key therapies of Cardio, Respiratory, Anti-Infectives, Oncology and Nephrology

Contribution from Chronic portfolio now stands @ 43 pc vs 40 pc, 3 yrs back

No of Brands in India with sales > 100 cr @ 10
No of Brands in India with sales > 50 cr @ 20
No of Brands in India with sales > 25 cr @ 37

India FMCG - 448 vs 397 cr, up 13 pc ( @ 9 pc of company sales ). India FMCG business recorded volume growth of 13 pc ( rest of the growth came from price hikes taken by the company ). Acquired Naturell India ( a healthy Snacking company ) for a cash consideration of 390 cr in Q3

US formulations - 2409 vs 1842 cr, up 31 pc YoY ( @ 47 pc of company sales ). Filed 10 new ANDAs and received approvals for 3 new products. Launched 5 new products in Q3, including 3 brands of Sitagliptin { a 505(b)(2) } product. The 3 brands include - Zituvio, Zituvimet, Zituvimet XR. Sitagliptin will go generic in FY 27

RoW formulations - 570 vs 493 cr, up 16 pc YoY ( @ 11 pc of company sales )

Some Updates from Q2 concall -

Company has acquired 50 pc stake in Sterling Biotech for 550 cr. Currently setting up state of the art manufacturing facility to produce fermented animal free proteins Also acquired sterling Bio’s API business that manufactures fermentation based APIs like - Lovastatin, Daunorubicin, Doxorubicin and Epirubicin

Entered into an exclusive licensing and supply agreement with Viwit Pharma for 02 - Gadolinium based MRI - contrast agents - to be supplied in the US mkts. These are injectables - used to increase the visibility of organs during MRI procedures. This is a niche but valuable drug. There r no generics for this drug currently in the mkt

Opportunities like - Palbociclib ( breast cancer drug ) and Riociguat ( for treatment of pulmonary arterial hypertension ) and Cabizantinib ( used to treat thyroid cancer ) should help them offset the loss of exclusivity on Revlimid ( to a large extent ) wef Jan 26. Company is also looking to file and launch a few more 505(b)(2) opportunities immediately. On both - Palbociclib and Riociguat - company is expected to get exclusivity for meaningful time period

Hopeful of getting a WHO approval for their MR ( measles and rubella ) Vaccine as well. Both these vaccines ( MR + TCV ) should bring in sizeable business for the company as UNICEF buys them in bulk every year ( to the tune of 8-10 cr doses each ). Scale up should begin sometime in FY 26. Even if they get a fraction of this business - it can be very significant business for the company

Company has a healthy pipeline of Transdermal and complex Injectable products to be launched in US - these should help them sustain the business momentum in the US mkt

Key things to watch out for in the Indian innovative portfolio of the company for the near future should be their mkt share in products like - Saroglitazar, Desidustat and the Biologics that the company is launching. Company’s mkt share - both in volumes and value for Ujvira ( Trastuzunab - for treatment of breast cancer ) is now higher than the innovator. Company aspires to take Saroglitazar and Desidustat to among top 50 products in IPM

Updates from Q3 concall -

Growth in US business led by expansion in base business + slew of launches carried out over the last 1 yr

Sitagliptin 505(b)(2) opportunity is a serious success story for the company - likely to bring in good revenues for the company. With Sitagliptin, company now has 07 X 505(b)(2) commercial products in US. Clearly, company now has a substantial 505(b)(2) portfolio in US

Sentynl Therapeutics, Inc. (Sentynl), a U.S. based biopharmaceutical company wholly-owned by Zydus Lifesciences, Ltd. (Zydus Group),
announced the execution of an Assignment and Assumption Agreement with Cyprium Therapeutics, Inc in Dec 23. Under the agreement,
Cyprium completed the transfer of its worldwide proprietary rights and U.S. FDA documents pertaining to CUTX-101, the copper histidinate product candidate for the treatment of Menkes disease, to Sentynl. Sentynl now assumes full responsibility for the development and commercialization of CUTX-101. In 2021, Sentynl and Cyprium reported positive results from a safety and efficacy analysis of data integrated from two completed pivotal studies in patients with Menkes disease treated with CUTX-101. A rolling submission of the CUTX-101 New Drug Application (NDA) to the FDA is ongoing, with expected completion in 2024. This launch is now imminent in next 6 months and the company is making all preparations for the same

Company has not hedged its receivables - hence has incurred forex gains in Q3. Not hedging receivables has been a normal practice by the company for quite some time now ( IMHO - its a risk that needs monitoring )

Asacol HD has seen entry of new players in Q3. Company expects entry of at least one more player in near future

Most of Revlimid revenues from Q4 + Q1. FY 26 should the last year of exclusivity wrt Revlimid sales { it seems ( from management’s commentary ) , FY 26 Revlimid sales may be below FY 25 sales - although I m not sure about the same }

Overall, expecting high single digit growth in revenues from US business in FY 26 - on the back of new launches. Company believes, FY 27 should be another good year for the company on the back of exclusive launches ( despite loss of Revlimid sales )

EM business momentum is looking good. Same is likely to continue in near future. EM business is likely to start achieving 23 pc + kind of EBITDA margins in not so distant future

Should be launching Semaglutide in India in the first wave. Company shall be making its own API and formulation for Semaglutide. Additionally, company has tied up for a second source supply of APIs as well. Also plan to launch in various EMs

CUTX - 101 is going to be chronic drug ( lifelong treatment )

Will be launching 02 products from the LiqMeds portfolio ( acquired in Oct 23 ) in the US mkt in current CY

Should see Sentynl Therapeutics ( company’s subsidiary ) becoming profitable in FY 26 post the launch of CUTX 101

Company spends about 35 pc of its R&D dollars towards speciality portfolio comprising - Biologics, NCEs, Vaccines, Speciality generics

For FY 26, 27 , Capex intensity should be higher than FY 25 ( say 20-30 pc higher than FY 25 ) as company launches and scales up a number of speciality opportunities. Additionally, will continue to focus on acquiring commercially viable speciality products in US in order to utilise the cash on books

Confident of building a pipeline of another 2-3 NCEs to be launched in India in next 3-4 yrs ( after the successful launch of Desidustat and Saroglitazar )

Company’s animal health business in US has already turned profitable

Company’s Biologics business is currently focussed on India + EMs only. Not likely to venture into regulated mkt with Biologics ( in near future )

Disc: holding, biased, not a buy / sell recommendation, not SEBI registered

3 Likes
1440

Apart from Sun Pharma, one of best large cap Pharma players…

They are running a diffrentiated play with some serious focus on NCE and Speciality drugs.

Does it work. Will ne clearer by '27

Discl: Holding, Looking to add.

1 Like
1441

Britannia Industries -

Q3 FY 25 results and Concall highlights -

Revenues - 4463 vs 4192 cr, up 6 pc
EBITDA - 763 vs 743 cr, up 3 pc
PAT - 582 vs 556 cr, up 4 pc

RM inflation has been extraordinary high for last 6-8 Qtrs causing margin pressures for the company despite a descent topline performance

Cereal inflation ( YoY ) in Q3 was @ aprox 7 pc, Veg Pils and fats inflation was @ aprox 14 -15 pc. For the company’s commodity basket, avg YoY inflation was 11 pc - which is quite steep. This along with an industry wide slowdown in Q2 + Q3 - has also led to demand challenges for the company

Did not take any price hikes in Q3 ( hence revenue and volume growths are almost same ). Have started taking some price hikes in Q4

Company has increased its direct distribution reach from 25 to 29 lakh outlets. Company has also increased its rural distributors from 30k to 31k ( over a period of last 9Ms ) - this is a key strategic focus

Some new product interventions / new launches - Pure Magic Choco-Frames ( Harry Potter themed ) - doing very well in EComm and Modern trade, Layer Cake - Twin flavoured, Rs 5 pack in the Rusks segment, Triple Chocolate Croissants, Re Launching - entire Cheese portfolio with new Graphics and Flavours, going to launch refreshed portfolio iro WinkinCow

International business is doing well across most segments / products

Inflation in Palm Coil + Cocoa have been really high offlate and have pushed up the entire inflation basket for the company into double digits ( @ 11 pc YoY )

Seeing strong double digit growth rates in Milk Shakes, Croissants

Have taken a 2 pc price hike recently. Should take another 2 pc price hike before Mar 25. Company did indulge in forward buying in a lot of commodities which helped them manage some RM inflation. Smaller players can’t do that, hence have had a bigger impact of severe RM price inflation

In line with Britannia, competition has also started taking price hikes ( a key positive for the company )

EComm - as a channel is proving to be much better for company’s adjacencies portfolio. Eg - EComm sales as a percentage of total sales is for Biscuits is only 4 pc but for Croissants it’s as high as 17 pc. For
Cakes, its @ 9 pc

Planning to take another 2 pc kind of price hike in Q1 FY 26. So the cumulative price hike should then reach about 6 pc

In addition, company hopes to achieve cost efficiencies of aprox 2 pc over the course of FY 26

The focus states now contribute 15-16 pc of company’s revenues for 12-13 pc a few years back These states are growing @ 2X the company avg. In thesis states, company’s mkt share is half of their all India mkt share - hence have a lot of growth head room. Also these states contribute to 35 pc of company’s rural sales

Company’s croissant business is likely to cross 200 cr in next FY. Their Shakes business has already crossed 200 cr. Similarly, the wafers portfolio is doing very well. In another 3 yrs or so, this part of the business should end up being a significant contributor at a company level

Capex intensity is going to be lower for FY 26 ( say about 150-200 cr ) - unless there is a sudden unexpected uptick in demand

In long term, company aims that if their topline growth is X, the growth in their fixed + variable costs is only 0.75 X - so that they can leverage their topline growth

The Finance Ministry has clarified that the import duties on Palm Oil is unlikely to go away. They want to Indigenize Palm Oil production and become self sufficient

Now that the Industry is clear that these costs are not going to come down in a hurry, the price hikes taken across the Industry have been far more decisive ( wef Q3/Q4 )

Disc: holding, added recently, biased, not a buy / sell recommendation, not SEBI registered

1 Like
1442

Jyothy Labs -

Q3 FY 25 results and concall highlights -

Revenues - 704 vs 678 cr, up 4 pc
Gross margins @ 49.8 vs 49.8 pc, flat YoY
EBITDA - 115 vs 118 cr, down 2.5 pc ( margins @ 16.4 vs 17.5 pc )
PAT - 87 vs 90 cr, down 3.5 pc

A&P spends @ 9 pc of sales ( it was @ 9 pc levels in LY Q3 )

Segmental revenues -

Fabric care - 35 pc
Dish Washing - 35 pc
Post Wash - 10 pc
Personal Care - 10 pc
Household Insecticides - 5 pc
Others - 5 pc

Exo Dishwash Bar Mkt share @ 14.1 pc
Pril Liquid Mkt share @ 13.5 pc
Ujala Detergent’s Mkt share in Kerala @ 24.5 pc
Maxo Liquid Mkt share @ 7.2 pc, Maxo Coils Mkt share @ 24 pc

Launched Maxo Anti-Mosquito rackets in Q3

Launched new - Sandal variant of Margo Soap, JOVIA - lemon and sandalwood soap

Q3 volume growth @ 8 pc ( vs topline growth of 4 pc )

9M volume growth @ 7.2 pc ( vs a topline growth of 4 pc )

Topline growth is less than volume growth as the company pushed higher grammages as consumer promotion initiatives

Except for HI business, Q3 topline growth was 6 pc and volume growth was 10 pc

Urban demand trends continue to remain tepid. Rural demand was much better led by strong rural wages

Quick commerce is having a meaningful impact on consumer behaviour in the Urban areas

Have taken selective price hikes in soaps portfolio in Q3. Effects should become visible in Q4

EBITDA margin decline is due to increase in operating expenses by 7-8 pc vs a topline increase of only 4 pc

Fabric Care portfolio grew in double digits in Q3, led by liquid detergents. Company is aggressively pushing Henko Liquid detergents. Launched MoonLight liquid detergent in Oct 24 - seeing good response

Dish washing category grew by 3 pc in Q3

Personal care portfolio de-grew by 3 pc in Q3

HI had a tough Qtr as the mkt is moving towards incense sticks, away from coils

Company has launched HI - Agarbattis under the Maxo naturals brand. Plan to launch more variants in this space

JOVIA - soap has been launched in the mass segment

Company’s personal care segment is quite small at present. Hence they have launched the JOVIA soap to augment their soaps franchise ( led by MARGO ). They have launched in economy segment as the current consumer behaviour is weakish and the consumers are tending to down trade

Intend to enter body wash segment in not so distant future

Company’s distribution strength is now quite meaningful. Hence they believe, they can launch and handle a few more brands than they currently have. That’s the reason behind the launch of JOVIA + a few more new launches r expected in not so distant future

Should be able to maintain the EBITDA margins in 16-17 pc range in Q4

Company revenue split between urban : rural is 60 : 40. Rural growth has been much better than Urban but can’t compensate for lack of growth in the larger chunk of Urban sales

HI business’s losses are now averaging @ aprox 8-9 cr / Qtr. Only when the business gains scale, the losses shall disappear

Company’s brands are challenger brands in most segments. However, that’s not having an adverse impact on Quick Commerce players stocking them - a key positive ( imo ). Quick Commerce is growing well for the company

Disc: holding, biased, added recently, not SEBI registered, not a buy/sell recommendation

1443

Gentle remainder to post your thesis on Eimco elecon. Eagerly awaiting your response

1444

I ll post a detailed reply by Weekend

Thanks for the reminder. Completely slipped from my mind :grimacing:

2 Likes
1445

Time Technoplast -

Q3 FY 25 results and Concall highlights -

Company’s products -

Polymer products like - Drums, Jerry cans, Polyethylene pipes, turfs and mats, disposable bins, MOX films, steel drums

Composite products like - Intermediate bulk containers, composite cylinders, Auto parts, energy storage devices

Out of the products listed above, the value added product segments include - Intermediate bulk containers ( IBCs ), Composite CNG,LPG cylinders and MOX films

Established products include - Drums, Jerry Cans, auto components, air and hydraulic tanks, their Lead - Acid batteries, door mats, PE pipes. Their batteries are used in Telecom sector, railway signalling and other Industrial applications

Q3 FY 25 outcomes -

Revenues - 1388 vs 1325 cr, up 5 pc
EBITDA - 201 vs 191 cr, up 5 pc (margins 14.6 vs 14.5 pc)
PAT - 102 vs 93 cr, up 10 pc

India volume growth @ 10 pc, International Volume growth @ 15 pc

India : International revenues @ 64 : 36

Value added products grew by 13 pc while established products grew by 2 pc YoY ( in volume terms )

Polymer : Composite products revenues @ 63 : 37

Polymer : Composite products margins @ 13.9 : 15.7

Established : Value added products revenues @ 71 : 29 ( for 9M FY 25, this ratio stood @ 73 : 27 )

9M FY 25 highlights -

Revenues - 3991 vs 3601 cr, up 11 pc
EBITDA - 574 vs 507 cr, up 13 pc
PAT - 278 vs 218 cr, up 28 pc

For 9Ms, VAPs grew by 17 pc and established products grew by 9 pc ( in volume terms )

Reduced Gross Debt by 92 cr in 9Ms

Net Cash from operating activities in 9Ms @ 285 cr

Capex spends for 9Ms @ 150 cr

Confirmed orders received for supply of packaging products @ 435 cr. Order book for Composite Cylinders @ 175 cr. Composite cylinders grew by 33 pc in 9M FY 25

Developed and launched E-Rickshaw batteries under the brand name - ’ E Start Selenium’. Addition of Selenium to lead acid batteries improves their performance meaningfully

The Company has committed to transform 75% of its electricity consumption to green energy within the next two years by tieing up with solar power generating Companies

The Company has made a strategic decision to consolidate its products and manufacturing units. This includes Brownfield expansion and adding New Units, which will better align with evolving market demands

Have got India approval for supply of HP Composite cylinders for UAVs / Drone applications

Company has manufacturing plants across India, UAE, Egypt, Saudi, Bahrain, US, Taiwan, Indonesia, Malaysia, Vietnam, Thailand, Bahrain

Breakup of company’s overseas business between ME, SE Asia, US stands @ 30 : 50 : 20. Confident of growing the total International business @ 15 pc kind of rates for foreseeable future

Topline growth for 9Ms, 3Q has been lower than volume growth because of reduction in RM prices

28 pc jump in PAT in 9Ms led by reduction in finance and depreciation costs

To continue to reduce Debt going forward

Have secured an approval to raise 1000 cr via QIP ( equity ) - aimed at reducing debt + capex. The approval is valid till 27 Nov 25

Aim to keep growing volumes @ 15 pc for foreseeable future

Composite Cylinders that company makes are for - LPG, CNG, Oxygen, Hydrogen

Company aims to be Debt free in next 12 - 18 months. They currently have a debt on books of 700 cr

Time Techno and Supreme Industries r the only 2 govt approved suppliers for LPG cylinders

In next 3-4 years, company expects all the CNG cylinders in the Auto sector to be replaced with composite cylinders

Expecting substantial pickup in demand for PE pipes ( mostly used for sewage and drainage applications ) from the Govt sector in Q4 ( as the Govt capex picks up )

Over medium term, company expects its packaging products to keep growing @ 10-12 pc while composite products to keep growing @ 30 pc

Company expects the VAP share of total revenues to reach 30 pc vs 25 pc currently ( over next 3 yrs ). That should help the company post > 15 pc EBITDA margins on a consolidated level

Once company transitions bulk of its energy consumption from renewable ( solar ) sources, it should help them save 30-35 cr / yr

Currently, total no of E-Rikshaws on Indian roads are aprox 15 lakh. Yearly addition to this number is to the tune of 3-4 lakh / yr. Each E-Rikshaw uses 4 Lead - Acid batteries costing aprox Rs 10k each. Clearly the Mkt size of E-Rickshaw batteries is huge and expanding rapidly. Company aims to clock 100 cr kind of annual sales from this segment in next 3 yrs. EBITDA margins in this segment should be around 12-13 pc

The metal cylinder used in households for LPG supply is of 14.2 kg. Currently, the company is supplying 10 kg composite cylinders as its replacement ( currently supplying to IOC + BPCL + HPCL ). These composite cylinders are growing > 50 pc CAGR. Company has now been asked to develop 14.2 kg cylinders by the Govt Oil Marketing PSUs. Should be able to start supplying these in H2 next FY. Once 14.2 kg cylinders r approved, the growth rates in this segment should increase further !!! Company may also be required to undertake capex for the same. The QIP money should then come handy

The difference between volume growth vs EBITDA growth ( former being higher than the latter ) is because of inventory losses that company has had to bear because of fall in RM costs

Composite Fire extinguisher cylinders is another good opportunity for the future. The light weight benefits should really help them replace the existing metal - heavier cylinders at a rapid pace. Plus the Chemicals used in fire extinguishers corrode the metals. So, use of composite material has two fold benefits

Company believes that piped gas connections are not a long term threat for their business as it’s not economical to supply them in Individual houses. They r economical only for flats in a high rise buildings

Disc: holding, added recently, biased, not a buy / sell recommendation, not SEBI registered

2 Likes
1446

@Ranvir – I’m not sure if I can comment on the technicals, but there’s a clear downtrend, at least on the daily chart (though not on the weekly or monthly). It’s also forming a Head and Shoulders pattern at the top, which could lead to a further 20-40% correction.

One more thing—this is more of a psychological question: How do you build conviction in a stock that has already risen 22.8x and buy it after just a 30% correction from its all-time high?

I’m guessing you’ll refer to the same “NUMBERS”— I’m all ears.

I’m a different kind of trader; I focus on value buying.

2 Likes
1447

I don’t think u can refer to the previous up move in the stock in order to make present buying / selling decision - provided the current valuations are not expensive

Time Technoplast is expected to make an annual profit of say 400 cr this year. Its Mkt cap is 8400 cr. That translates to a PE of 21 on FY 25 earnings. That’s not expensive ( if not cheap )

Future growth drivers for the business look strong. The base business is steady ( ie growing in single digits ). New products like composite CNG, LNG cylinders are expected to grow @ > 20-25 pc CAGR for next 3-5 yrs. Future earnings visibility is good ( imho )

So … that’s the logic

As far as technicals are concerned, I m an illiterate ( literally )

7 Likes
1448

Orient Electric -

Q3 FY 25 results and concall highlights -

Q3 outcomes -

Revenues - 817 cr, up 8.6 pc
Gross Margins @ 31.7 vs 31.1 pc
EBITDA - 61 cr, up 25 pc ( margins @ 7.5 vs 6.5 pc )
PAT - 27 cr, up 12 pc ( margins @ 3.3 vs 3.2 pc )

9M FY 25 outcomes -

Revenues - 2232 cr, up 10.2 pc
Gross Margins @ 32.4 vs 30.3 pc
EBITDA - 137 cr, up 20 pc ( margins @ 6.1 vs 5.6 pc )
PAT - 52 cr, down 16 pc ( because LY results had a one time exceptional gain on the sale of a RE asset )

Aim to significantly increase contribution from premium fans from current 30 pc levels

Launching multiple products in the consumer lighting portfolio. Expanding the distribution of lighting products in an aggressive fashion

DTM route in case of fans now expanded to 7000 retailers. DTM fans are growing in high double digits

Gross and EBITDA margins improved significantly in Q3. Likely to improve further with kicking in of efficiencies ( + cost reduction programs ) and operating leverage

Working capital @ 16 days vs 24 days in Q3 FY 24 ( significant improvement )

Net Cash @ 93 cr

Segmental performance -

Lighting and Switchgears -

Revenues - 242 vs 217 cr, up 12 pc YoY
EBITDA - 32 vs 31 cr, up 5 pc YoY ( margins @ 13.3 vs 14.2 pc )

Consumer Lighting continued to grow in high double digits. Revenues hit by continued price erosions. B2B segment’s momentum in lighting business continues to be strong led by sweet lighting, facade lighting projects

Switch Gears also grew in double digits - led by expanding electrification and expanding distribution by the company

Wires registered muted growth due price fluctuations

ECD -

Revenues - 574 vs 535 cr, up 7.5 pc YoY
EBITDA - 64 vs 60 cr, up 7 pc YoY ( margins @ 11.2 vs 11.3 pc )

Fans grew @ high single digits
Launched new Air Coolers, Water Heaters in Q3

Festive season saw strong demand followed by a slowdown in Nov - Mid Dec. Did saw a descent uptick in late Dec, specially for winter oriented products

Onset of summer, revival in Govt capex should augur well for the company in Q4

BLDC fans are growing at > 20 pc

Hyderabad capex is now online and has stabilised. Should provide positive operating leverage as topline growth picks up

Company’s emphasis on premiumisation should also lead to better margins going forward

Company is operating via 2 models depending on state to state. Uncertain states, company has appointed master distributors which then distribute to distributors
and retailers. In some other states ( like WB ), company has removed the additional layer of master distributors and the company sells directly to distributors / retailers. The second category of states are showing much faster growth rates. Company’s broad revenue distribution between the two types of distribution models is 70:30 ( 70 pc coming from states with master distributors )

Expecting a strong summer season in FY 26

Company has invested ahead of time in its infrastructure ( including manufacturing capacities and employees / talent ). As the topline grows and operating leverage kicks in, the margin trajectory should remain strong

Pre - Covid, company used to 32-33 pc GMs. Recently ( 2 yrs back ), the company’s GMs dropped to as low as 27-28 pc. Now ( last 2-3 Qtrs ) they are back to 31-32 pc band again. Aspiration is to grow these GMs to 34-35 pc band. The launch of Switchgears and Switches should help the company to move in that direction. Switches + Switchgears are a high margin category

B2B lighting business has a strong tailwind because of strong infrastructure development across the country. The pricing pressures seen in lighting business are severe in Batons and Bulbs. The value added lighting, decorative lighting are seeing lesser pricing pressures

Company’s lighting business split between B2B : B2C @ 20:80

See good potential in the Wires business. Currently, their base is small. Should take some time before they can build it up to a descent size

Disc: initiated a tracking position, biased, not a buy/sell recommendation, not SEBI registered

1 Like
1449

Krsnaa Diagnostics -

Q3 FY 25 results and concall highlights -

Q3 FY 25 outcomes -

Revenues - 174 cr, up 10 pc
EBITDA - 46.6 cr, up 23 pc ( margins @ 27 vs 23 pc - massive margin expansion )
PAT - 19.4 cr, up 50 pc

9M FY 25 outcomes -

Revenues - 531 cr, up 17 pc
EBITDA - 141.6 cr, up 39 pc ( margins @ 27 vs 24 pc - massive margin expansion )
PAT - 57 cr, up 49 pc

Krsnaa Diagnostics picked up 24 pc stake in Apulki Healthcare which operates hospitals ( Cardiac and Cancer care ) under PPP model. Due to this deal, Krsnaa will get to provide diagnostics services to Apulki Healthcare facilities for next 30 yrs. Currently, Apulki is in process of setting up 2 cancer and cardiac care hospitals in Pune + Mumbai. They eventually aim to set up 10 hospitals. The first 2 hospitals of Apulki Healthcare should get operationalised in FY 26 ( early FY 26 )

Company’s current facilities -

178 - Radiology centers offering MRI + CT scans + X Ray tests ( doing aprox 1.5 lakh CT+ MRI scans / month + 6 lakh X Rays / month )

121 - Pathology processing labs with 3423 collection centers

These facilities are spread across 150 districts in India across 18 states and UTs

Company has recently won major contracts in Jharkhand, Assam, Maharashtra, MP and Odhisa. With these wins, company shall operationalise an additional 45 radiological centers, 01 Pathlab and 731 collection centers to fulfil the demand from these new order wins

Company has entered into a strategic partnership with United Imaging and Medikaa Bazaar. This collaboration represents a 300 + cr investment targeting the establishment of our 30 plus cutting edge imaging and pathology centers across Tier 1, Tier 2 and Tier 3 cities in India. This partnership, one of the largest and the most innovative in the Indian diagnostics space brings together the best of technology and health care expertise, significantly enhancing patient care and accessibility

United Imaging, known for its state-of-the-art MRI-CT, PET-CT and other advanced imaging solutions, along with Medikabazaar, extensive distribution capabilities have recognised Krsnaa Diagnostics as a pivotal partner due to our expansive reach and established reputation for delivering high-quality affordable diagnostic services

Geographical distribution of revenues -

North - 36 pc
What - 31 pc
South - 19 pc
East - 14 pc

New Radiology centers likely to come up in near future -

UP - 3
Rajasthan - 1
Maharashtra - 33
MP - 5
Jharkhand - 3

New Pathology collection centers likely to come up in near future -

Mumbai - 116
Assam - 372
Jharkhand - 1

National Health mission budget has been increased from Rs 31550 to 36000 cr in the latest Union budget

PMJAY’s budget has been increased from 6800 to 7300 cr in the latest Union budget. PMJAY also extended health insurance to 1 cr GIG workers. These r natural tailwinds for the company

Revenue momentum in Q3 was lower than company’s expectations due to delay in handover of CT / MRI sites across MP and Maharashtra

Revenues from the newly awarded centers in Maharashtra should start to flow wef Q1 FY 26

Over and above the Govt business, company has started its private B2C diagnostics business in Maha, Punjab, Assam and Odisha under the brand RPL. Initial response has been encouraging

Company’s receivables for 9M FY 25 are on higher side due delay in payments from HP and Karnataka. Except for these 2 states, company’s receivable days stand at 65 days. Receivables from Karnataka and HP stand @ 120 days. Company hopes, receivable days from these 2 states should fall to around 90 days by the year end

B2C retail segment is expected to start contributing meaningfully wef FY 26

Q3 Radiology : Pathology revenue contribution @ 49:51. Radiology levels are much higher vs Pathology

Old / Mature centers are operating @ 36 pc EBITDA levels. Newer ( < 1.5 yrs old ) centers are operating @ 17 pc EBITDA margins. As these centers mature, company’s overall margin trajectory may be benefited

Company intends to establish itself as the most affordable, accurate + 24 X 7 service provider via its retail venture RPL. Company is leveraging its existing infrastructure to manage its B2C foray. Integrated Radiology + Pathology solutions at one place is unique to the company

Likely to see moderate growth in Q4. Bigger growth pickup is expected to happen wef Q1 next FY

Company has also moderated its operations in Karnataka and HP due longer payment cycles

Received 30 cr from HP in last 9Ms. Expect some more payments in Q4

Company expects to keep having 5 cr / Qtr kind of other income because of > 200 cr of cash that they have

The delay in handover of Radiology sites in Maharashtra + MP ( that happened in Q3 ) led to an approximate revenue loss of 15-20 cr

Wrt payments that are due from Karnataka - the same have been approved. Company expects to receive them over next 2-3 weeks

Company’s B2C foray should not warrant heavy capex as the company is going to leverage its existing B2G infra for the same

Disc: holding, biased, not a buy / sell recommendation, not SEBI registered

3 Likes
1450

Dabur India -

Q3 FY 25 results and concall highlights -

Revenues - 3355 cr, up 3.1 pc
EBITDA - 682 cr, up 2.1 pc ( margins @ 20.3 vs 20.5 pc )
PAT - 522 cr, up 1.5 pc

India value growth @ 1.2 pc ( volume growth @ 1.7 pc )
International value growth @ 8.5 pc

Segment wise sales in domestic business -

Home and Personal care - 1110 cr, up 5.7 pc
Healthcare - 872 cr, down 1.3 pc
Food and Beverages - 273 cr, down 10 pc

International business - 847 cr, up 8.5 pc ( constant currency sales @ 19 pc !!! )

International business now contributes to 25 pc of company’s topline

Breakup of International business -

US - 13 pc
Turkey - 28 pc
MENA - 18 pc
Egypt - 10 pc
SSA - 10 pc
Bangladesh - 21 pc

Category wise performance -

Home and Personal care -

Oral care grew by 9.1 pc ( Dabur Red and Meswak continued to do well )

Hair care grew by 2.7 pc ( gained 150 bps mkt share in hair oils, gained 20 bps mkt share in shampoos )

Home care grew by 5 pc ( Odonil and Sanifresh grew in double digits, Odomos reported a muted performance due slowdown in entire category )

Skin care grew by 5.6 pc ( led by strong performance in Gulabari franchise )

Healthcare -

Health supplements de-grew by 3.5 pc ( due weaker than expected winters )

Digestives grew by 4 pc, led by Hajmola franchise

OTC and Ethicals were flat YoY ( represented by brands like Honitus, Shilajit, Women’s health tonics )

Food and Beverages -

Foods grew by a massive 30 pc ( led by Homemade, coconut milk, Oil and Ghee, tomato puree and Lemoneez )

Badshah masala grew by 15 pc

Bevrages de-grew by 10 pc ( due increase in competitive intensity )

Rural growth outpaced urban growth for 4th consecutive Qtr

Taking a number of new initiatives in the beverages category to come back to growth trajectory in the upcoming summer season. Real Active juices ( premium range ) grew in Q3 as well against a sharp overall decline

New toothpaste launched LY - Dabur Herbal is growing > 20 pc CAGR. This is over and above very healthy growth rates being reported by Dabur Red and Meswak

Undertaking a lot of marketing initiatives @ the MAHAKUMBH mela

Competitive intensity in the beverages is being raked up by Campa Cola by operating at lower price points + offering bigger trade margins

Likely to take price hikes going forward across foods, oral care in a calibrated fashion

Real Active is doing well but currently only 10 pc of their total beverages portfolio

Likely to come out with smaller packs + consumer offers to take on the competitive intensity in the beverages space

LY - there were unseasonal rains in the Summer season. This adversely affected their beverages business. Next yr, the base should be favourable. Additionally, most of company’s beverage sales come from Urban India which is going through a consumption slowdown. These two factors have also contributed to the pressure in their beverages business

As the consumption growth levels are low ( Urban + Rural ), company is going slow on advertising. As the consumption pattern revive, company will ramp up its advertising efforts

As the consumption growth levels are low ( Urban + Rural ), company is going slow on advertising. As the consumption pattern revive, company will ramp up its advertising efforts

Disc: holding, biased, not SEBI registered, looking for a bounce back in overall consumption trends so as to get a short term uptick on the stock price, not a buy/sell recommendation, posted for educational purposes