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Kamdhenu Limited Q4 FY24 Earnings Conference Call Summary
Key Highlights • Date of Call: May 8, 2024 • Revenue Growth: 5% increase to INR 176 crores • Profit Growth: • Profit Before Tax (PBT): Up 54% • Profit After Tax (PAT): Up 56% • Dividend: INR 2 per equity share approved
Steel Business Performance • Domestic Steel Consumption: Increased by 13% due to infrastructure investments • Franchisee Volumes: Grew by 9% • Profit Before Tax: Increased by 22% for FY24 • Future Growth Target: 16%-17% anticipated
Paints Business Update • Market Growth: Indian paint industry projected to grow from INR 75,000 crores to INR 125,000 crores by FY29 • Revenue Growth: 12% increase to INR 292 crores for FY24 • EBITDA Margin: Achieved 8% margin, turning positive from a loss last year • Future Growth Target: Over 20% growth expected in FY25
Strategic Plans • Funding: Plans to raise INR 100 crores through convertible warrants • Sales Capacity: Aim to double sales capacity in five years • Dealer Network: Over 8,500 active dealers, with a focus on expansion in smaller towns
Market Insights • TMT Bar Market Share: Kamdhenu holds 22-23% in the organized branded market • Royalty Structure: Current average royalty per tonne is INR 395, with a target of INR 500 in five years
Capital Expenditure and Product Strategy • TMT Bar Capacity: Setting up 2 lakh metric tonne capacity requires INR 70-80 crores • Focus on Quality: Emphasis on branding and value-added products
Future Projections • Paint Business Revenue: Projected INR 380 crores for FY25 with a 9.5% EBITDA margin • Steel Production: Targeting an increase from 32.5 lakh metric tonnes to 68 lakh metric tonnes through franchisee route
Conclusion • Management Optimism: Positive outlook on growth opportunities in both steel and paint sectors, supported by strong brand presence and market dynamics.
Kamdhenu Limited Earnings Conference Call Summary (November 9, 2023)
Company Performance Overview • Date of Call: November 9, 2023 • Key Executives: Chairman Satish Kumar Agarwal, Group CFO Harish Agarwal • Financial Highlights: • Steel business revenue: INR 393.6 crores (H1 FY '24), 3% YoY growth • Total brand turnover: INR 11,935 crores, 17% increase
Steel Segment Insights • Market Demand: Rising demand for TMT steel bars due to construction activities in India. • Dealer Network: Over 8,500 dealers enhancing market reach. • Volume Growth: 10% YoY growth in steel volume from franchisees.
Paint Segment Performance • Revenue Growth: Kamdhenu Ventures reported INR 127.5 crores, 7% increase. • EBITDA Turnaround: Positive EBITDA of INR 8.9 crores. • Funding: Raised INR 65.25 crores for Kamdhenu Colour and Coatings Limited.
Strategic Initiatives • Expansion Plans: Focus on distribution, product quality, and under-penetrated markets. • Franchisee Network: Plans to expand and increase capacity, especially in South and West India. • Debt Management: Company is essentially debt-free with minor borrowing.
Market Challenges and Competitive Strategy • New Competitors: Concerns about Grasim and JSW entering the paint market. • Grassroots Marketing: Emphasis on customer loyalty and strong retail network to compete. • Revenue Target: Aim for INR 1,000 crores in paint business by FY '28.
Future Growth Projections • Sales Increase: Targeting growth from INR 400-450 crores to INR 1,000 crores over five years. • Product Focus: Emphasis on water-based products to mitigate rising oil prices. • Regional Performance: Strong performance in Northern India, with expansion efforts in Central and Southern regions.
Conclusion • Capacity Development: Installed capacity of 5.052 million tons with plans for annual increases. • Shift in Sales Focus: Moving from B2B to B2C sales through retail networks. • Management Confidence: Positive outlook on growth trajectory despite competitive pressures.
Kamdhenu Limited Q4 and FY 2023 Earnings Conference Call Summary
Conference Call Details • Date: May 22, 2023 • Submission Date: May 26, 2023 • Participants: Chairman and Managing Director Satish Agarwal, CFO Harish Agarwal
Financial Performance Highlights • Brand Sales Turnover: • FY 2023: INR 21,000 crores (32% increase) • Q4 FY 2023: INR 5,677 crores (18% increase) • Revenue Growth: • FY 2023: INR 732 crores (22% increase) • Paint business: INR 260 crores (7% increase) • Steel Volumes: • Franchisee volumes: 8.05 lakh metric tons (17% increase) • Total steel volume: 29.82 lakh metric tons (21% increase) • TMT volume: 102,080 metric tons (15% annual growth)
Strategic Goals • Capacity Expansion: • Steel: Increase from 40 lakh metric tons to 50 lakh metric tons • Paint: Target turnover of INR 1,000 crores in four years • Market Focus: • Emphasis on Tier 2 and Tier 3 cities • Expansion of dealer network and premium product offerings
Financial Management • Working Capital: Raised INR 65.25 crores for marketing and operational needs • Pending Fundraising: INR 70 crores awaiting regulatory approval
Market Position and Competition • Market Share: 27% in TMT bar market, competing with Tata Steel and regional players • R&D Initiatives: Ongoing efforts for new product launches
Future Outlook • Demand Growth: Anticipated 15-20% growth in paint demand • Revenue Capacity: Expected to reach INR 450 crores with new funds • Government Contracts: Focus on retail with potential future opportunities in government projects
Conclusion • Management expressed gratitude to participants and encouraged further inquiries.
Kamdhenu Limited Earnings Conference Call Summary
Date and Submission • Date of Call: February 3, 2023 • Submission: Transcript submitted to National Stock Exchange and BSE on February 8, 2023
Financial Performance • Q3 FY2023 Revenue: ₹183 Crores (23% YoY growth) • Nine-Month Revenue: ₹565 Crores (36% increase) • Capacity Utilization: • Own plant: 85% • Franchise units: 70%
Business Developments • Demerger: Successful separation of paint business to enhance focus and growth • Steel Segment Demand: Strong demand driven by construction projects and government support • Capacity Expansion Plans: Increase from 38 lakh metric tons to 50 lakh metric tons over two years
Marketing and Branding • Branding Investment: ₹38 Crores spent in first nine months of FY2023 • Future Plans: Increase branding budget to over ₹50 Crores in FY2024 and FY2025
Growth Strategies • Franchise Expansion: Focus on increasing franchise capacity and adding new units • Installed Capacity Goal: Increase from 3.8 million tons to 5 million tons in two years • R&D Focus: Ongoing research for new products, especially TMT bars
Revenue Goals • Future Revenue Growth: Targeting 25% growth for FY2024 and FY2025 • Long-Term Revenue Target: Aim to reach ₹1000 Crores by FY2028
Market Insights • Raw Material Prices: Currently stable despite previous escalations • Sales Optimism: Positive outlook for achieving Q4 sales targets
Investment Plans • Fund Infusion: Planning to infuse at least ₹200 Crores for new units and marketing, contingent on securing funds from strategic investors • Collaboration with EY: Preparing for investment opportunities
Conclusion • Management's Closing Remarks: Harish Agarwal thanked participants and offered further assistance through investor relations.