Yasho Industries

Stock Opportunities Untested - but worth a good look
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Posting the Q3 Concall Notes -

  1. EBITDA Margins stood at 19.5% and PAT margins at 10%
  2. Increase in volume @ 21% YoY and 5% for Nine months (Signaling Demand recovery)
  3. Dahej Plant’s Trail run has began and since the EBITDA margins of the products from new plant is 20%+ new leg of margin expansion will come from here
  4. Industrial segment accounted for more than 87% of the revenue out of which export accounted for 62% total revenue
  5. Incorporated subsidiary in US making it area for future growth
  6. Downward revision in the guidence of total plant capacity → Pakhajan can do 550 to 600 crores of revenue and Vapi can do 650 Crores (earlier guided for 700 to 750) at optimum utilisation (90%)
    this downward revision is just on account of correction in RM prices
  7. The prices of RM are correcting i.e. Inching Upward, but not at the speed it dropped
  8. The company is seeing spark already but too early to comment weather this will be fire or fizzle down
  9. current capacity is utilization 85%
  10. Will complete trial, will take govt approvals and then only can start taking orders as client will need everything before placing orders. Will get govt certification within 4 - 8 Weeks
  11. Peak EBITDA will be 120 crores from Vapi facility
  12. Depreciation is on lower side as some asset have got fully depreciated
  13. Peak debt will be 500 crores including WC
  14. Markets will rebound overall within next 2 quarters as the demand comes back in European as well as Asian country
  15. Vapi is completely saturated @18% EBITDA margins any new improvement will come from pakhajan only

Disclaimer as above

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Hi @Ashar_Mann
From whatever I understood abt Yasho, is that the pricing of the items would be generally a pass through. if that is the case and the RM costs is inching upwards, then why would the revenue from the new plants decline, shouldn’t it increase? Did the mgmt say anything about why the downward revision to the revenue potential

Disclosure: not invested

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46

Hey @divygupta
So Yes you are correct that any kind of RM Increase will result in the increase in the revenue as the it’s a pass Through
The Downward Revision is on the basis of Current Prices of RM if you see management has said that they are not committing to the statement that Price will go back to mean of RM and hence the statement that → weather the price inching up is likely to be a fire or Fizzle out
Hence in short downward revision is Excluding the increasing RM Prices
→ my bad should have framed sentence better :sweat_smile:
Disclaimer as Above

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