In This Article:
Release Date: May 12, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Fine Organic Industries Ltd (NSE:FINEORG) demonstrated agility and strength amid macroeconomic volatility, focusing on sustainability, innovation, and customer-centric solutions.
-
The company reported a 6.9% increase in revenue from operations, reaching INR 2,269 crore for FY25.
-
Fine Organic Industries Ltd (NSE:FINEORG) is expanding its export capabilities with a new manufacturing facility in Maharashtra, expected to be completed within 18 to 24 months.
-
The company plans to establish a manufacturing facility in the United States, enhancing its local presence and reducing logistics costs.
-
Fine Organic Industries Ltd (NSE:FINEORG) resumed full operations at its Baur manufacturing unit, which had been temporarily shut down, ensuring safety protocols are in place.
Negative Points
-
The company faced cost-related headwinds, including rising raw material prices and utility costs, impacting margins.
-
EBITDA decreased by 4% year-on-year to INR 512.9 crore in FY25.
-
Fine Organic Industries Ltd (NSE:FINEORG) is cautious about its US expansion due to lack of experience with US regulations and systems.
-
The company is managing elevated inventory levels due to supply chain disruptions and geopolitical conditions.
-
Fine Organic Industries Ltd (NSE:FINEORG) is unable to take on significant new accounts until additional capacity is available, potentially limiting growth.
Q & A Highlights
Q: Can you provide details on the CapEx for the new facility at JNPT Mumbai? A: The total CapEx for the JNPT Mumbai facility is estimated to be around INR 700-750 crore, which will be executed in stages over the next 24 months, subject to necessary approvals. (Respondent: Unidentified_2)
Q: With a significant cash balance, how do you plan to utilize it for expansion, particularly in the US? A: The cash will be used for expansions in both the JNPT and US facilities. We plan to keep some cash reserves for potential opportunities and will also consider debt financing to support these projects. (Respondent: Unidentified_2)
Q: What are the challenges and strategies for the US expansion? A: We are cautious with our first US plant due to regulatory and operational differences. We plan to start with a conservative capacity and learn from the initial phase to manage the plant effectively. (Respondent: Unidentified_2)
Q: How will the US and UAE expansions affect your product offerings and market presence? A: Initially, the US plant will produce the same products we currently export from India. Over time, we will introduce new products. The UAE expansion will start with a sales office, with potential for future manufacturing. (Respondent: Unidentified_2)