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Kamdhenu Ventures Limited Q4 FY24 Earnings Conference Call Summary
Key Highlights • Date of Call: May 8, 2024 • Submission: Transcript submitted to National Stock Exchange and BSE on May 11, 2024 • Management Present: Group Chairman Satish Kumar Agarwal and other key executives
Financial Performance • Revenue: Increased by 5% to INR 176 crores • Profit Before Tax (PBT): Up by 54% • Profit After Tax (PAT): Increased by 56% • Dividend: INR 2 per equity share approved
Steel Sector Insights • Market Growth: India's steel consumption rose by 13% in FY24 • Volume Growth: 9% increase in steel volume • Profit Growth: 22% increase in PBT for steel business • Future Outlook: Projected 8-9% annual growth in steel segment
Paints Business Update • Market Expansion: 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 in FY24 • EBITDA Margin: Achieved 8% margin, ahead of target • Future Goals: Over 20% growth in FY25, focusing on premium products
Strategic Initiatives • Funding: Raising INR 100 crores through convertible warrants for franchisee business and new ventures • Dealer Network: Over 8,500 active dealers; plans to expand dealer network in smaller towns • Capacity Goals: Aim to double sales capacity in five years
Market Position • TMT Bar Market Share: Kamdhenu holds 22-23% in the organized branded market • Franchisee Royalties: Current royalty per tonne ranges from INR 400 to INR 450, with a target to increase to INR 500 in five years
Future Projections • Paint Business: Projected turnover of INR 380 crores for FY25 with a 9.5% EBITDA margin • Steel Production: Targeting to increase capacity from 41 lakh metric tonnes to 50 lakh metric tonnes in FY25
Conclusion • Overall Outlook: Both steel and paint segments expected to see growth, with no signs of slowdown in the paint market.
Kamdhenu Ventures Limited Q2 FY24 Earnings Conference Call Summary
Key Management and Performance Highlights • Date of Call: November 9, 2023 • Management Present: Group Chairman Satish Agarwal, Managing Director Saurabh Agarwal • Overall Performance: Strong growth in steel and paint sectors
Financial Performance • Steel Sector: • 3% revenue growth year-on-year • 10% growth in steel volume from franchisees • Total brand turnover increased by 18% to INR 5,804 crores • Profit after tax: INR 10.2 crores (up 24% YoY) • Paint Sector: • 7% revenue increase • Positive profit after tax of INR 5.6 crores in H1 FY24 • EBITDA turnaround attributed to premium product focus
Strategic Initiatives • Funding and Share Issuance: • Raised INR 65.25 crores through qualified institutional buyers • Announced a 1:1 bonus equity share issuance • Expansion Plans: • Targeting brand turnover of INR 25,000 crores for FY24 • Plans to expand franchisee and dealer network, especially in South and West India • Strategy to achieve INR 1,000 crores in revenue by FY28 through organic and inorganic growth
Market Challenges and Competitive Landscape • Challenges: • Market slowdowns and adverse weather affecting paint sector • Competition: • New entrants like Grasim and JSW adopting aggressive pricing • Kamdhenu's established grassroots presence and customer loyalty as competitive advantages
Product Focus and Future Outlook • Product Development: • Emphasis on water-based, eco-friendly paint products • Current EBITDA margin for paint business: 6% • Growth Expectations: • Aiming for 20-25% annual growth • Plans to increase sales from INR 400-450 crores to INR 1,000 crores over five years
Operational Insights • Steel Production Capacity: • Current capacity: 5.052 million tons, with plans to increase by 500,000 tons annually • Focus on enhancing existing franchise units through backward integration • Sales Strategy: • Shift from B2B to B2C sales to improve margins and service quality
Closing Remarks • Conclusion: Management expressed confidence in growth trajectory in both sectors and thanked participants, wishing them well for Diwali.
Kamdhenu Ventures Limited Q4 and FY 2023 Earnings Conference Call Summary
Submission Details • Date of submission: May 26, 2023 • Conference call date: May 22, 2023 • Submitted to: National Stock Exchange and BSE
Company Performance Highlights • Chairman Satish Agarwal's Report: • 32% increase in brand sales turnover for FY 2023: INR 21,000 crores • 22% revenue growth: INR 732 crores • Company is now debt-free • Target for FY 2024: Brand sales turnover of INR 25,000 crores, increasing capacity from 40 lakh to 50 lakh metric tons
• Managing Director Saurabh Agarwal's Insights: • Paint business revenue: INR 260 crores (7% increase) • Focus on premium products and expansion into Tier 2, 3, and 4 cities • Raised INR 65.25 crores for paint business support
Financial Results Overview • Steel Volumes: • Franchisee steel volumes: 17% increase in Q4 to 8.05 lakh metric tons • Full year growth: 21% to 29.82 lakh metric tons • TMT volumes from own facility: 15% growth for the year to 102,080 metric tons
• Turnover and EBITDA: • Q4 brand turnover: INR 5,677 crores (18% increase) • FY '23 turnover: INR 21,197 crores (32% increase) • Q4 EBITDA: INR 15.2 crores (down from INR 19 crores in Q4 FY '22) • FY '23 EBITDA: INR 60 crores (10% growth)
• Paint Business Goals: • Target turnover: INR 1,000 crores in four years • Current capacity utilization: 25% for paint, 85% for steel
Fund Utilization and Market Position • Funding Plans: • INR 70 crores fundraising for paint business awaiting regulatory approval • Funds raised to be used for expansion, debt reduction, and automation with potential revenue of INR 450 crores
• Market Competition: • Kamdhenu holds a 27% market share in TMT bar market • Competitors include Tata Steel and regional players
Demand and Future Plans • Demand Insights: • Expected growth in paint demand: 15-20% • Plans to enhance dealer networks and branding
• Additional Fundraising: • Plans to raise INR 135 crores for paint business through strategic partnerships
• Government Projects: • Focus on retail segment with future opportunities in government projects
Conclusion • Management thanked participants and invited further inquiries.