June quarter was badly impacted due to GST issues and some orders getting held back. June FY16 quarter sales were significantly higher due to onetime export order.
Q2 onwards things are fine and improving.
Order book is around Rs 893 crore which translates to around 27000 MVA as on June 17.
Continues to expect net sales of around Rs 880-900 crore for FY 18 which means sales to pick up significantly going forward in FY 18.
Australia, Latin America, CIS countries and Iran are some of the key markets where the company has a strong presence in international market.
Enquiry levels are high from exports, from SEBs as also from industrial segment. The only worry is PGCIL which has offered less tenders on YoY basis.
Expects around 20% of sales from exports, 15% sales from industrial segment, 10% from Solar transformers and rest around 55% sales to come from utilities.
The company is the largest supplier to Metros for the transformer requirements and is present in virtually every Rail Metros in India.
Expects margins to improve on an annual basis. Continues to target margins of around 12% at operating levels in next couple of years. Higher capacity utilization, more matured competition, large export orders and cost control will lead to higher margins.
Solar transformer continues to do well. PPAs have come down but so as the cost of solar projects. While tenders have slowed down due to the pricing issues, expects orders to come back soon in this segment.
The company has successfully completed installation of one large transformer in FY 17. Expects around 10 such new orders by FY 18.
Borrowing is around Rs 200 crore with average interest of around 11%. Expects borrowings to remain at these levels despite higher sales due to better advances.
The company has received transformer orders from railways as well which have better margins.
Ferro Alloy market is picking up again and the company has received orders for supply of transformers to this segment.
Overall management continues to expect to perform well going forward and continue to remain optimistic and June 17 quarter was a one off.
Overall, with current capacity, the company can generate net sales of around Rs 1200 crore without any additional capex.
At the beginning of FY18, the guidance given was 15-20% increase in revenues that is around 920-950 cr. however it was revised down after Q1 to 880-900 cr and again after Q2 to 750-800 Cr.
FY19 guidance is given as 10-15% increase in revenue.
Overall it seems the growth in transformer industry is further away than originally anticipated.
If anyone joined Q2 concall, kindly share your notes. I am not able to find audio clip for it.
Another bad set of results from Transformer and Rectifier India Ltd.
Highlights of conf. call
Total orderbook currently 1049 crores. FY18 Guidance given as 700 crores. FY19 guidance given as 850 cr (conservative).
Revenue was down in this quarter due to execution challenges mainly because of Technical issues. This is reason for lower revenue inspite of strong order book. Now the issues are overcome but this has resulted into inventory pile up.
Concentrating more on industrial transformers. Executed orders of Mexico and Iran are working as expected. Inquiries are received from multiple geographies and focus is on exploring that. Orders received from Pakistan (Through some other vendor) and Russia.
Major orders received are from Russia and there are negotiations with other russian firms. Order from Australia is executed except 1 transformer which is expected this month.
250 crores guidance for Q4FY18. Major is from Domestic orders. Out of domestic, Govt. orders form major chunk.
EBIDTA for FY18 will be 9%. In FY19 it is expected to be higher 10-12%.
There is recovery visible in private industry and demand from it. Current orderbook is above 100 crores from Private industries.
Q1FY19 will be as strong as Q4FY18. Considering teething issues are now resolved, Whole focus is on executing the order book while getting new orders.
Focus is on 2019 elections hence electrification will be done. More inquiries from State Electrivity boards. Once demand goes up, prices will go up and there are no new facilities are coming up in industry. More orders will be from Trains, Metros.
Employee Cost is up due to hiring more people. Manpower is increased so that in future once order increase, capability is available to execute them.
Points noted:
Management keeps giving higher guidance and fails to meet it. [See articles published in above messages]. Will be watching results closely for next 2 quarters to see if they can improve in their execution capabilities and match given guidance before taking a decision.
If I have missed out on any points, kindly add. @basumallick - Are you still invested here? If you are still tracking, kindly share your thoughts on last 2 results.
I had booked profits precisely for the reason you have mentioned. The nos were coming through and the order book story was being constantly being peddled. I will relook once the nos get delivered.
Net Sales 223.82 vs 131.50 YOY ( Sales up by 70%)
EDITDA at 16.69 Cr Vs 7.32 Cr YOY ( EBITDA up by 128%)
PAT at 2.43 cr vs a loss of 2.16 cr YOY
EPS at 0.18 vs -0.16 YOY
Overall a very good set of results considering the YOY figures.
TRIL is poised for Growth , but growth remains inconsistent till now. Should do well going fwd. I don’t see any reason why TRIL can not grow from here on. This quarter results are one off may not repeat in future.
Can you explain your reason for optimism? There have been instances in last couple of years where management has missed on their guidance on lower side by big margin. Do you have any data or any other sectoral news for transformer industry to support your view on TRIL?
We issue with cyclical s is , it tests the patience , its not only TRIL, other companies like APAR also did not perform. In fact all companies in infra and capital goods space did not perform as was expected . With such a decent order book , I think it is going to perform as the it seems pvt capex is picking up.
The main reason for these companies not performing was because of its sole reliance in public capex , where there is some issue definitely , otherwise the numbers would have proved.
Now if pvt capex is on the rise , these companies will be benefited significantly.
Industry is in down cycle since 2009, demand not revived as expected from new government since 2014, but we can see the cycle in stock price. Current utilization in the industry is still in 60%s. It should pick up-to 80%+ to see improvement in operating margins. Industry suffering with over capacity since few years. Private capex could help only a little as most of the demand should come from public utilities.
As newly added power capacity is mostly in renewable and wind energy sector has slow downed due to policy changes and Solar slow downed due to safeguard duty on imports. Though all these are only temporary, increase in the power capacity addition should happen tomorrow if not now to support energy requirements of growing India.
On the supply capacity side, there is a rumor that one big player is looking to close the plant and an other big company is suffering with huge debt, it may be dragged to NCLT (my expectation only). If both happens there will be considerable reduction in the industry capacity which can also help to increase in operating margins.
Does TRIL counter is value buy at this level?
1)750cr order book
2)33000MVA capacity (10% total indian cap.)
3)75% Promotor holding
4)World class manuf.facilities and working cultre I personally visited company nd impressed.
5)all available at m.cap of 150cr at 11.7
Does it makes sense to buy now?
Talked with Bbl,emco,voltamp and tril senior executives all are saying one thing this year is one of the best year for industry…
Realisations are improving a lot, delayed projects gets clearance and demand shootup will change the picture of transformer industry.
Voltamp and tril wil be among the best performer due to their lowest production capasity…
Also trying to talk with Bhel siemens alstom and abb executives if anyone can psl share…
Renewable energy, rail electrification, and EV story will drive the growth further looks it comes ahead of time…
Govt. Announced some franchisee model for power discom companies under UDAY scheme …?what does it means and how it will impacted trabsformer companies if anybody know ?
In Q4FY22 presentation they guided -
REVENUE Rs. 1200-1250 Crs.
EBITDA Rs. 80-100 Crs. PAT Rs. 18-23 Crs.
Orders on Hand - Rs. 1148 Cr as on 31st March, 2022
In Q1FY23 presentation they guided -
REVENUE Rs. 1250-1300 Crs.
EBITDA Rs. 90-105 Crs. PAT Rs. 35-45 Crs.
Orders on Hand - Rs. 1377 Cr as on 31st July, 2022
