In This Article:
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Revenue from Operations: INR 105.5 crores, a 26.2% increase year-over-year and 4.1% growth quarter-over-quarter.
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Total Income: INR 16.34 crores for the quarter.
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EBITDA: INR 18.96 crores, with a year-over-year decline due to competition and raw material cost fluctuations.
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EBITDA Margin: 17.97% for Q2 FY '25, compared to the guided range of 20%.
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Quarter-over-Quarter EBITDA Growth: 34.7% increase from Q1 FY '25.
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PAT and EPS Growth: 30.1% growth quarter-over-quarter.
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Distribution Network: 2,476 nodes, excluding OEM partners.
Release Date: November 18, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Sirca Paints India Ltd (NSE:SIRCA) reported a significant top-line growth with revenue from operations reaching INR105.5 crores, marking a 26.2% increase year-over-year.
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The company has successfully implemented a strategic price increase across its product portfolio, which is positively impacting EBITDA.
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Sirca Paints India Ltd (NSE:SIRCA) is expanding its distribution network, currently having 2,476 nodes, and is investing in marketing to strengthen brand visibility.
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The recent acquisition of Brand Welcome products has strengthened the company's product portfolio and expanded its customer base.
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The company is making strides in technology with the enhanced Sirca app, improving customer engagement and streamlining the royalty program.
Negative Points
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Heightened competition in the general polyurethane products segment is putting downward pressure on pricing, affecting profitability.
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Fluctuating raw material costs have impacted the company's profitability and margins.
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The EBITDA margin for Q2 FY '25 is 17.97%, below the guided range of 20%, due to increased dealer schemes and muted demand.
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The company faced challenges with prolonged rainy seasons affecting demand, particularly in August and September.
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Export contributions remain negligible, with only minor exports to Sri Lanka and trial shipments to Russia, indicating limited international market penetration.
Q & A Highlights
Q: Can you provide details on the revenue contribution from the new acquisition and core business for the current quarter? Also, what are your expectations for margins in the long term given the current competition? A: The revenue contribution from the new acquisition, Welcome, was about INR11 crores, while INR96 crores came from our core PU business. Regarding margins, Q2 was challenging due to prolonged rains and muted demand, impacting margins by about 2.5% to 3%. However, with corrective measures like price increases, we expect to return to our original margin levels in the second half.