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Aarti Industries Ltd Q1 FY23 Result Updates.

Aarti Industries Ltd Q1 FY23 Result Updates. Robust revenue momentum was supported by higher volumes.

Aarti Industries Ltd Q1 FY23 Result Updates.
Robust revenue momentum was supported by higher volumes.

Q1FY23 revenue of Aarti Industries grew by 9.8% YoY & by 12.3% QoQ to Rs19.7bn. Robust revenue momentum was supported by higher volumes & better realisations. Healthy volumes was majorly because of commercialization of 1st & 2nd long term contract which benefitted the company. The speciality chemicals segment increased by 44% YoY and by 8% QoQ to Rs17.65bn and the pharmaceuticals segment increased by 48% YoY and by 5% QoQ to Rs4.07bn in Q1FY23. Higher raw material prices has led to contraction of gross margins by 935bps YoY and 318bps QoQ to 44.3% in Q1FY23.
EBITDA grew by 17.7% YoY & by 8.9% QoQ to Rs3.7bn in Q1FY23. EBITDA margins declined by 510bps YoY and by 59bps QoQ to 18.7% in Q1FY23.
Consolidated PAT grew by 15% YoY & declined marginally by 2% QoQ to Rs1.89bn in Q1FY23.

Pharma margins increased sequentially.

EBIT margins in pharma segment stood at 18.7% in Q1FY23 vs 17.2% in Q4FY22 vs 19% in Q1FY22. The company has been able to pass on the cost inflation to its ends user industries, which led to improvement in margins during the quarter. The company has started commercialization of its capacities in API’s & intermediates business at Tarapur facility which will lead to contribute to revenue in the coming quarters. The off-patented approach is paying off well to drive growth. The new API capacity commercialization has started and would contribute to revenues from the next quarter once capacity ramps up faster.
The company reported slight decline in EBITDA margin on sequential basis by 59bps to 18.7% in Q1FY23 vs 19.3% in Q4FY22 majorly because of rising raw material prices of benzene, Aniline, PAN etc. Capex incurred for Q1FY23 is Rs2bn. The major capex is in the downstream chemistries of benzene & NCB business, chlorotoluene value chain, Acid division in the speciality chemical segment. In the pharma segment, the Tarapur API USFDA approved facility has been commercialized in Q1FY23. Demand from pharma, agrochemicals etc segment remained strong.

The shares of Aarti Industries Ltd are trading at Rs. 831.10, up by 2.55%.

Valuations:
The return on equity (ROE) is 27.8% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 22.6. The return on capital employed (ROCE) for the company is 22.7%. The price to book value of Aarti Industries Ltd. is 5.13. The EV/EBITDA is 16.1. EPS during the quarter came at Rs. 36.7.

Tips Industries generated a net profit of Rs. 17.17 cr. in Q1 FY23.

 

 

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Dollar Industries Ltd  Q1 FY23 Result Updates.

Dollar Industries Ltd  Q1 FY23 Result Updates. Volume growth to increase revenue.

Dollar Industries Ltd  Q1 FY23 Result Updates.

Volume growth to increase revenue.

 

Dollar Industries Ltd  reported revenue in Q1FY23 grew by 76.7% YoY which was led by a volume growth of 54% YoY & rest of the growth was on account of increase in average selling price due to price hikes taken by the company in order to pass on increase in cost of raw materials.

In Q1FY23, the company reported a 76.7% YoY increase in sales to Rs 3,614 mn, which was led by a healthy volume increase of 54% YoY. Growth in volumes was mainly led by compay’s flagship brands Dollar Man and Dollar Always.

Gross margin for Q1FY23 declined by 573 bps YoY at 33.9%. Decline in gross margin was due to increase in raw material cost, which company was not able to fully pass on to the customers. However gross margin improved by 173 bps QoQ.

EBITDA margin for Q1FY23 declined by 697 bps YoY at 10.3%. Decline in EBIDTA margins was mainly led by decline in gross margin. Advertisement expenditure for Q1FY23 was at 9.7% vs 7.2% YoY of sales.

Company reported PAT of Rs 270 mn up 19.6% YoY helped by a lower tax rate of 14.3% vs 25.6% YoY. PAT Margin was at 7.5% vs 11% YoY.

 

Growth driven by project Lakshya.

 

In Q1FY23 revenue contribution from different segment- economy-38%, mid-premium50%, premium-12%. Company has taken a price increase of 4.5% in April 2022. Further due to recent correction in cotton prices from the peak company does not plan to take any further price increase in the short term. Revenue contribution by category for Q1FY23: Dollar Man-47%, Dollar Always-40%, Dollar Women-9%, Force Next-3%, Force Gowear-1% . Breakup of revenue for Q1FY23 geography wise: North-44%, West-21%, East-26%, South-9%.  Share of revenue from Mordern Retail was 4%.

 Currently company is exporting to 15+ countries and export mix was 8% of revenue in Q1FY23, target is to increase export markets and increase share of exports to 11% of revenue by FY25.

 In Q1FY23 contribution of athleisure wear was 14% of sales, management expect strong growth in the athleisure wear segment to continue going forward.  In Q1FY23 company incurred advertisement expenditure of Rs 350 mn ie 9.7% of sales as compared to Rs 146 mn ie 7.2% of sales in Q1FY22. Advertisement expenditure in Q1FY23 was mainly on sponsoring IPL 2022 (nonrecurring), launch of new TVC for Dollar Woman and the campaign for completion of 50 glorious year of Dollar Industries Ltd.

 In Q1FY23 14% of domestic revenue contribution was from distributor under Lakshya.

In Q1FY23 company has improved its net working capital days by 47 days YoY to 172 days. However, it has increased by 18 days as compared to Q4FY22 mainly due to increase in inventory days led by increase in procurement of winter products as the demand for it would start from Q2FY23.

 

 

The shares of Dollar Industries Ltd  are trading at Rs. 468.60, up  by 9.47%.

 

Valuations:

The return on equity (ROE) is 23.9% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 17.4. The return on capital employed (ROCE) for the company is 26.8%. The price to book value of Dollar Industries Ltd  is 3.92. The EV/EBITDA is 12.4. EPS during the quarter came at Rs. 26.6.

Tips Industries generated a net profit of Rs. 17.17 cr. in Q1 FY23.

 

 

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Suprajit Engineering Ltd Q1 FY23 Result Updates.

Suprajit Engineering Ltd Q1 FY23 Result Updates. Poor operational performance of Phoenix Lamps division.

Suprajit Engineering Ltd Q1 FY23 Result Updates.
Poor operational performance of Phoenix Lamps division.

Suprajit Engineering Ltd reported a net profit of Rs. 27.3 crores, declined by 36.7% YoY from Rs. 43.2 crores and down by 43.8% QoQ from Rs. 48.6 crores. The net profit margin came at 4.2%, down by 770 bps YoY and down by 538 bps QoQ.
The total income stood at Rs. 645.2 crores as compared to Rs. 361.6 crores up by 78.4% YoY and 27.5% QoQ from Rs. 505.9 crores. Gross margin for the quarter is 40.4%, down by 428 bps YoY and 677 bps QoQ.
The Earnings before interest, tax, depreciation and, amortization is at Rs. 54 crores as against 49.2 crores in June 2021 and 76.6 crores in the March quarter.
Q1FY23 was a challenging quarter, mainly due to initial sharp hiccups witnessed post the acquisition of LDC and poor operational performance of Phoenix Lamps division.

Phoenix is facing input cost pressure due to higher gas prices.

Domestic auto cable performance was good despite muted 2W industry performance. It was able to pass-on material cost increase to OEMs and aftermarket.
Exports challenges continue w.r.t. the demand & supply situation along with a cost increase due to geopolitical situation. On the positive side, Suprajit received price increases from most of the customers, and container costs have come down from the peak. In addition, the company continues to receive new businesses from diverse customers across geographies.

For non-auto cables, the performance is stable and margins are in-line with expectations. YoY EBITDA margin declined by 510bps due to timing issues and one-offs. In the long term, the margin will be in-line with the past. There is a good order backlog in Wescon Controls, but some impact of lag in the price pass-on, impact of accelerated dispatches from India, paid higher freight charges and has some shortage of labors over there.

The growth of Phoenix Lamps division was good, but margins remain under pressure. The main issue is that the input cost increased due to 20x jump in rare gas prices. The major source of these gases are Russia and Ukraine. While, China and South Korea also supply these gases.
The challenges faced by Light Duty Cable (LDC) division in Q1 were the China lockdown impact; plants in China were operating at less than 50% utilization in the 1st quarter. Earlier management has not taken price increases from customers, but given price increases to its suppliers and the Hungarian currency depreciated by 30%, among other smaller issues. There is a lag effect of cost pass-on, which previous management has not done. LDC business impacted due to 1) China lockdown, 2) utilization dropped to below 50%, 3) Hungarian plant head left immediately post the acquisition, 4) Hungarian ‘Forint’ depreciated by 30% and 5) most important earlier management has not taken a price increase from customers after giving price increase to its suppliers.

The company has about Rs 2.71bn of cash in hand, which invested in MFs. The acquisition cost is included in other expenses. Other income includes forex gain as USD appreciated. Capex will be Rs 1.4bn for India operations and normal capex of Rs 160-240mn for LDC, total capex will be Rs 1.56bn. The revenue from throttle cable is approx. 15% of the total cables revenue.

The shares of Suprajit Engineering Ltd are trading at Rs. 338.40, down by 0.03%.

Valuations:
The return on equity (ROE) is 15.9% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 29.3. The return on capital employed (ROCE) for the company is 17.3%. The price to book value of Suprajit Engineering Ltd is 4.32. The EV/EBITDA is 14. EPS during the quarter came at Rs. 11.4. Gross debt is Rs 5.37bn as on 30th June 2022, increased from Rs 3.11bn as on 31st March 2022. It is due to debt taken for the acquisition of LDC.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Page Industries Ltd Q1 FY23 Result Updates.

Page Industries Ltd Q1 FY23 Result Updates. Strong net profit growth & margin performance.

Page Industries Ltd Q1 FY23 Result Updates.
Strong net profit growth & margin performance.

In Q1FY23, company reported a 167% YoY & 20.7% QoQ increase in sales to Rs 13,413 mn. Strong topline growth was backed by a volume growth of 150% YoY & 26% QoQ at 63 mn pieces. Company has taken a price increase of 3.5%-4.5% in Q1FY23.
The Earnings before interest, tax, depreciation and, amortization (EBITDA) increased by 771% YoY & 11.5% QoQ at Rs 2,978 mn. Company has been able to contain the impact of steep increases in raw material prices with a combination of price increase, better inventory management & cost control.
Net profit stood at Rs 2,070 mn up 1791% YoY & 8.7% QoQ. Board of Directors of the company has declared an interim dividend of Rs 60 per equity share.

Volume growth was led by growth across all its product categories.

Page Industries Ltd. (PAGE), reported strong topline growth in Q1FY23, with revenue up by ~167% YoY on a low base of last year backed by volume growth of 150% YoY & 26% QoQ. Volume growth was led by growth across all its product categories which is backed by an increase in distribution network, good demand traction in EBO’s & e-commerce channel. Growth was same across both primary & secondary sales channel. In Q1FY23 company has added 13 EBO’s & now has 1,144 EBO’s stores. Also it has added 3,167 MBO’s and is now present across 1,13,715 stores across India. Company has planned a capex of Rs 4500 mn in FY23 for capacity expansion and investment in increasing digital capabilities.
Demand was good across all its product categories and expects similar trend to continue. Management highlighted that there was good growth across all distribution channels. Demand was good across tier 3/4 cities along with metro and tier 1 cities. Company has taken a price hike of 3.5%-4.5% in Q1FY23 to pass on the impact of raw material inflation. Company has 16%-18% market share in men’s innerwear and a single digit market share in womens, athleisure, kids’ category which provides large opportunities for growth going forward.
Company has been able to contain the impact of steep increase in raw material prices with a combination of price increase, better inventory management and cost control. E-commerce sales contribution is 8.5%, which was 9% during pandemic period. Contribution from MBO’s and modern trade continue to be the same.
At the end of Q1FY23 cash & cash equivalent stood at Rs 3,144 mn vs Rs 2,835 mn QoQ.

The shares of Page Industries Ltd are trading at Rs. 49,517, down by 0.84%.

Valuations:
The return on equity (ROE) is 14.4% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 75.2. The return on capital employed (ROCE) for the company is 67.2%. The price to book value of Page Industries Ltd is 50.7. The EV/EBITDA is 51.4. EPS during the quarter came at Rs. 657.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Nestle India reported a net profit of Rs. 515 crores:

Minda Corporation Ltd Q1 FY23 Result Updates. Raw material prices to hamper margins.

Minda Corporation Ltd Q1 FY23 Result Updates.
Raw material prices to hamper margins.

Minda Corporation Ltd reported a net profit at Rs.524.9Mn, increased by 30.8% QoQ and 638.3% YoY.
The company reported at Rs. 10,102 Mn (including Minda Instruments Ltd-MIL) with 6.6% QoQ and 80.8% YoY growth driven by revenue visibility in both ‘Mechatronics & aftermarket’ and ‘Information & connected system’ business segments with increase in business share from existing customers and rise in content per vehicle.
EBTIDA stood at Rs. 1,066Mn, up by 1% QoQ and 246.1% YoY and EBITDA margin stood at 10.6% , declined by 81bps QoQ. The margins were supported by higher operational efficiencies despite increase in raw material prices.
Profit before tax reported at Rs. 709.8Mn, improved by 1.3% QoQ. Finance costs increased by 9.9% QoQ to Rs. 82.1Mn. Revenue growth is driven by overall industry growth.

Growth in all the business segments .

During the quarter, Minda corp has delivered growth in both the business segments. Mechatronic revenue reported at Rs. 4,920Mn 45.1% YoY and 4.6% QoQ with a continued growth in exports and aftermarket sales. It has increased in share of business. EBITDA margin stood at 12.6% in Q1FY23 as compared to 13.4% in Q4FY22 on account of rise in raw material prices during the quarter. The segment mainly focuses on EV segment for 2Ws and increasing share of business from existing customers.

Information and connected system revenue reported at Rs. 3,620Mn, up by 64.9% YoY and 6.8% QoQ; as there was an improvement across most segments that sustained revenue growth despite supply chain constraints. EBITDA margin declined up to 7.1% as compared with 7.4% in Q4FY22 due to rise in raw material prices. In Q1FY23, overall revenue grew by 80.8% at Rs. 10,102Mn which is highest in the history backed by new business and rise in share of business from existing customers from wiring harness and Mechatronics segments. Also, growth in PVs and 2Ws segment led to revenue growth in Die casting business along with exports.

By End market segments, Passenger vehicles, 2-3 wheelers, Commercial Vehicles and after market segments contributed 14.5% , 43.7% ,30.1% , 11.7% in Q1FY23 as compared with 15.9% , 50.4% , 22.6% , 11.1% in Q1FY22, respectively.

Minda Corp reported 85.2% of its revenue from domestic business and 14.8% of revenue from exports in Q1FY23 (8.9% from Europe and North America and 5.9% from South East Asia). Overall exports for the quarter impacted due to geopolitical issues and seasonal impact by a customer. Revenue from die casting business stood at Rs. 152Cr at full capacity utilisation levels. During the quarter, other expenses were de-grew on a sequential basis by 3.1% where Minda Corp has controlled conversion course and administration expense.

The shares of Minda Corporation Ltd are trading at Rs. 224.10, down by 0.07%.

Valuations:
The return on equity (ROE) is 13.5% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 25.4. The return on capital employed (ROCE) for the company is 11.8%. The price to book value of Minda Corporation Ltd is 4.05. The EV/EBITDA is 14. EPS during the quarter came at Rs. 9.92.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Vinati Organics Ltd Q1 FY23 Result Updates.

Vinati Organics Ltd Q1 FY23 Result Updates. Increase in revenue driven by ATBS sales.

Vinati Organics Ltd Q1 FY23 Result Updates.
Increase in revenue driven by ATBS sales.

Net profit has seen a jump of 24.97% YoY to Rs. 1,011 Mn. The PAT margins contracted by 97 bps YoY and 83 bps QoQ to 19.97% in Q1FY23.
In Q1FY23, Vinati Organics’s consolidated revenue grew by 31.03% YoY and by 4.16% QoQ to Rs. 5,063 Mn. Overall demand growth was led by ATBS segment.
Earnings before interest, tax, depreiation and amortization (EBITDA) has seen a growth of 28.79% YoY basis and de growth of 5.67% QoQ to Rs. 1,309 Mn, while EBITDA margins remained flat down 45bps YoY and declined by 269 bps QoQ to 25.85% in Q1FY23.
The demand from end user industry pushed ATBS sales. The company delivered sharp uptrend in its consolidated revenues 31.03% YoY and 4.16% QoQ to Rs. 5,063 Mn. Such performance was led by higher volumes coming in due to increasing demand for high purity grades of ATBS. The growth was also supported by Butyl phenol business. The antioxidant plant is currently operating at 25% capacity and is expected to touch 50% capacity in next year.

Increased realisations were the result of input cost transfer.

On operational front the company delivered EBITDA growth of 28.79% YoY basis and 5.67% QoQ to Rs. 1,309 Mn. EBITDA margins remained flat down 45bps YoY and declined by 269 bps QoQ to 25.85% in Q1FY23. The company has been able to maintain the margins per kg due to softening of Acrylonitrile prices and its ability to pass on the input cost to its customers. Also freight cost has begun to come off lately from peak levels. PAT saw a jump of 24.97% YoY to Rs. 1,011 Mn. The PAT margins contracted by 97 bps YoY and 83 bps QoQ to 19.97% in Q1FY23. Vinati organics is able to get bookings for shipments but overall time taken for it is still high.
Continuous investment led to growth. VOL intends to expand its Acrylamide tertiary-butyl sulfonic acid (ATBS) capacity from present 40,000MT to 60,000MT. The announced capex is going to be a brownfield expansion to the tune of Rs. 3,000 Mn which will be funded through internal accruals and is expected to get commissioned by December 2023. Also with that it plans to expand its product portfolio through Veeral Organics Pvt Ltd (its fully owned subsidiary) by introducing products like MEHQ & Guaiacol (2,000 MT) and Iso Amylene (30,000 MT). It will be a sole manufacturer of Iso Amylene in India and is initially looking to cater the export demand. These products are employed in pesticides, medicines, flavours, and polymerization inhibitors. While this will be a greenfield expansion the total capex is approximately Rs. 2,800 Mn.

The shares of Vinati Organics Ltd are trading at Rs. 2227.45, down by 0.72%.

Valuations:
The return on equity (ROE) is 20.6% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 62.6. The return on capital employed (ROCE) for the company is 26.6%. The price to book value of Vinati Organics Ltd is 12.5. The EV/EBITDA is 43.7. EPS in Q1FY23 came at INR 9.85 against Rs. 9.84 in the same period last year.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

LUX Industries Ltd. Q1 FY23 Result Updates.

LUX Industries Ltd. Q1 FY23 Result Updates. Healthy sales growth, margins impacted due to higher raw material cost.

LUX Industries Ltd. Q1 FY23 Result Updates.
Healthy sales growth, margins impacted due to higher raw material cost.

Lux Industries Ltd. (LUX), reported sales of Rs. 5687 mn for Q1FY23 increased by 36.2% YoY backed by a volume growth of 14% YoY at 75 mn pieces and average selling price increase of 19% YoY. Growth in volumes was largely driven by increased demand for branded products from Tier I, II and III cities. Volumes in the economy/mid-premium/premium segment increased by 8%, 27%, 1% respectively while rest of the growth was on account of increase in price and product mix. Share of exports was 6% of total sales.
Net profit for Q1FY23 declined by 20.9% YoY to Rs 507 mn. PAT Margin was at 8.9% vs 15.4% YoY.
Company has been taking regular price increases in order to pass on higher raw material cost. Gross margin for Q1FY23 declined by 600 bps YoY to 31.8% on account of increase in raw material cost, stocking of high cost inventory in the previous quarters & volatile price of raw materials. In Q1FY23 EBITDA declined by 14.3% YoY to 748 mn. EBITDA margin for Q1FY23 declined by 776 bps YoY to 13.2%, mainly led by decline in gross margins and increase in advertisement expenditure which increased by 62% YoY at 420 mn.
Gross margins were impacted due to high cost inventory stocking in the previous quarters and volatile prices of raw materials. Company witnessed healthy traction for its men’s premium brand “ONN” (contributed 5% of sales in Q1FY23) with sales of Rs 300 mn up 94% YoY & women’s brand “Lyra” (contributed ~17% of sales in Q1FY23) with sales of Rs 970 mn up 136% YoY. Company’s latest offering of brand Lyra has been gaining good response from the market helping it to evolve from legging centric brand to multi-product, multi-category women’s wardrobe brand. Management highlighted that going forward with softening of raw material prices & streamlining of the high cost inventory, it expects gradual improvement in margins.

Growth on account of price increase and product mix.

In Q1FY23 company reported a volume growth of 14% YoY at 75 mn pieces, while rest of the growth was on account of price increase and product mix. Growth in volumes was largely driven by increased demand for branded products from Tier I, II and III cities. For Q1FY23 economy segment’s (35% of Q1FY23 sales) revenue grew by 20% YoY to Rs 1,980 mn while revenue from mid- premium segment (52% of Q1FY23 sales) grew by 52% YoY to Rs 2,960 mn. Additionally, revenue from the premium segment (13% of Q1FY23 sales) increased by 25% YoY to Rs 710 mn. Volumes in the economy, mid-premium, premium segment increased by 8%/27%/1% YoY respectively. Average realisations increased by 11%/20%/23% YoY respectively. Overall ASP increased by 19% YoY on account of price increases taken by the company to pass on higher raw material cost. In Q1FY23 geographical mix of sales was North: 35%, East: 21%, West: 25%, Central: 15%, South India: 4% In Q1FY23 womenwear brand “Lyra” reported sales of Rs 970 mn up 136% YoY. Lyra contributed 17% of total revenue. In Q1FY23 company’s premium brand “ONN” reported revenue of Rs 300 mn up by 94% YoY (contribution 5% of sales). Since premium brands have higher gross margins, increasing contribution should help the company to improve overall margins of the company. In Q1FY23 advertisement spend was Rs 420 mn (7.4% of Q1FY23 sales).
The shares of LUX Industries Ltd. are trading at Rs. 1763, up by 0.05%.

Valuations:
The return on equity (ROE) is 29.3% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 16.1. The return on capital employed (ROCE) for the company is 34.7%. The price to book value of LUX Industries Ltd. is 4.05. The EV/EBITDA is 11.6. EPS during the quarter came at Rs. 110.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Hero MotoCorp Ltd Q1 FY23 Result Updates.

Hero MotoCorp Ltd Q1 FY23 Result Updates. Input cost pressures to impact performance.

Hero MotoCorp Ltd Q1 FY23 Result Updates.
Input cost pressures to impact performance.

Hero MotoCorp Ltd reported a net profit of Rs. 624.5 crores, increased by 70.9% YoY from Rs. 365.4 crores and down by 0.4% QoQ from Rs. 627.1 crores. The net profit margin came at 7.4%, up by 78 bps YoY and down by 101 bps QoQ.
The total income stood at Rs. 8392.5 crores as compared to Rs. 5487.1 crores up by 53% YoY and 13.1% QoQ from Rs. 7421.7 crores. Gross margin for the quarter is 27.2%, down by 24 bps YoY and 348 bps QoQ.
The Earnings before interest, tax, depreciation and, amortization is at Rs. 940.8 crores as against 514.8 crores in June 2021 and 827.6 crores in the March quarter.
Q1FY23 numbers are below estimates largely due to input cost pressures, which expect to cool-off in the subsequent quarters owing to softening of commodity prices.

Domestic market share improved.

QoQ domestic motorcycle market share improved by 425bps to 51.8% and scooters share improved by 60bps to 6.7%. This is driven by premium xTec series, healthy marriage season & rural uptick. Export demand is facing headwinds due to currency depreciation & geopolitical conditions.
Two wheeler demand is on a healthy trajectory supported by normal monsoon & opening up of all sectors in the economy. Hero MotoCorp’s Q1 retails were better than wholesales. The underlying demand is good and the momentum is in the right direction. The company launched various models in xTec series; this along with future launches should help improve the market share in scooters and motorcycles. xTec series prices are 7-10% higher than base models, the demand for these models are better than anticipated.
July sales were lower as some variants were facing chip issues. Normal inventory level is 6-8 weeks, and by the end of June, the inventory was 6-7 weeks. On scooters, it launched Destini 125cc xTec model with good features and has been doing well. Export demand is facing some headwinds due to currency depreciation & geopolitical conditions . The demand for xTec series is healthy despite 7-10% higher prices.
Employee cost inched-up by 13% QoQ due to salary revision (higher increments than previous years) and bonus. Some part of it will moderate. No major cost impact expected due to OBD2. Other income declined sharply due to MTM loss of Rs 600mn. Blended realization dropped QoQ by 3% due to lower sales from spare parts, lower other operating income (Rs 1.09bn in Q1 vs. Rs 1.86bn in Q4) and expiry of Neemrana plant benefit. The core realization improved by Rs 800 QoQ due to price increase and better mix. QoQ drop is mostly due to seasonality.

The shares of Hero MotoCorp Ltd are trading at Rs. 2802.25, down by 0.15%.

Valuations:
The return on equity (ROE) is 14.4% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 21.2. The return on capital employed (ROCE) for the company is 18.6%. The price to book value of Hero MotoCorp Ltd is 3.55. The EV/EBITDA is 13.3. EPS during the quarter came at Rs. 133.

Campus Active Wear Limited Q1 FY23 Result Updates. Net profit surged to Rs. 28.66 crores driven by strong demand.

Linc Pen and Plastics Ltd Q1 FY23 Result Updates. Increase in selling price to improve gross margin.

Trident Industries’ net profit stands at Rs. 129.35 crores.

Gujarat Alkalies clocked a net profit of Rs. 220 Cr. in Q1 FY23.

Alembic Pharmaceuticals Ltd Q1 FY23 Result Updates. Profitability declined due to sales decline and increased costs.

Alembic Pharmaceuticals Ltd Q1 FY23 Result Updates.
Profitability declined due to sales decline and increased costs.

The company witnessed a 4.8% YoY (-10.8% QoQ) decline in the revenue to Rs. 12.62 bn in Q1FY23. This was due to flat to a decline in the US, Ex-USA, and India formulations revenue as well as in the API revenue on a YoY basis, in Q1FY23.
The EBITDA margins declined 871 bps YoY (-222 bps QoQ) to 9.1% and EBITDA declined 51.4% YoY (-28.4% QoQ) to Rs. 1.15 bn in Q1FY23.
The company incurred a net loss of Rs. 659.0 mn in Q1FY23 vs. net income of Rs. 355.0 mn in Q4FY22 and a net profit of Rs. 1.65 bn in Q1FY22. Adjusting for the unusual expenses, the company’s adjusted net profits declined 70.2% YoY (+38.3% QoQ) to INR 491.0 mn in Q1FY23.

Revenue decline across segments.

The US revenue declined 0.5% YoY (-34.1% QoQ, 29.0% of revenue), the Ex-USA revenue declined 7.6% YoY (-3.2% QoQ, 14.0%), India revenue declined -0.2% YoY (+6.9% QoQ, 38.0%) and API revenue declined 16.5% YoY (+5.0% QoQ, 18.0%). The US revenue was flat YoY due to price erosion across the portfolio; partially offset by higher volumes with market share gains. The sequential revenue growth was negative for the US, due to the higher stocking carried out by the distributors in Q4FY22. India’s revenue was affected due to the higher base effect of Q1FY22 with more of COVID 19 product sales then. However, excluding COVID 19 sales, India branded business revenue would have grown at 20.0% YoY in Q1FY23. The API sales decline was due to lower volumes in Q1FY23.

The company’s gross profit margins (GPMs) declined 131 bps YoY (-374 bps QoQ) to 70.0% in Q1FY23 due to increased raw materials costs (as a % of revenue) in Q1FY23. Gross profits declined 6.1% YoY (- 14.2% QoQ) to Rs. 8.84 bn. Also, the EBITDA margins declined 871 bps YoY (-222 bps QoQ) to 9.1% and EBITDA declined 51.4% YoY (-28.4% QoQ) to Rs. 1.15 bn in Q1FY23. The company’s employee costs remained flat YoY (+4.8% QoQ) and other expenses increased 15.3% YoY (- 19.2% QoQ). However, with a 41.5% YoY (-89.3% QoQ) fall in other income, Rs. 1.15 bn of Aleorrelated unusual impairment expenses, and a 316.6% YoY (+31.2% QoQ) rise in interest expenses.

With the change in crude oil prices, the company is witnessing an increase in costs such as of solvents and materials costs but is trying to contain the costs as much as possible. The margins have eroded in the US across therapy products.

The shares of Alembic Pharmaceuticals Ltd. are trading at Rs. 658.95, up by 1.36%.

Valuations:
The return on equity (ROE) is 10% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 43.7. The return on capital employed (ROCE) for the company is 11.1%. The price to book value of Alembic Pharmaceuticals Ltd. is 2.46. The EV/EBITDA is 19.3. EPS during the quarter came at Rs. 16.

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Britannia Industries Limited Q1 FY23 Result Updates.

Britannia Industries Limited Q1 FY23 Result Updates. Net profit growth driven by increase in prices.

Britannia Industries Limited Q1 FY23 Result Updates.
Net profit growth driven by increase in prices.

Britannia Industries Limited reported a net profit of Rs. 337.4 crores, declined by 11.2% YoY from Rs. 389.6 crores and sequentially fell by 11.2% QoQ from Rs. 379.9 crores in the previous quarter. The net profit margin stood at 9.1%, declined by 158 bps QoQ and 233 bps YoY.
The revenue for the June quarter stood at Rs. 3701 crores, up by 8.7% YoY from Rs. 3403.5 crores and increased by 4.2% QoQ from Rs. 3550.5 crores.
The Earnings before interest, tax, depreciation, and amortization stood at Rs. 500.7 crores from Rs. 553.8 crores down by 9.6% YoY and from Rs. 549.7 crores down by 8.9% QoQ. The EBITDA margin is 13.5%, down by 195 bps QoQ and 274 bps YoY.

Commodity cost inflation impact margins.

Volume decline YoY has been in small single digit in Q1FY23, while total price increase would be over 20.0% YoY. Number of packages sold was flat. Biscuits being the cheapest form of snacking has relatively fared better, which has helped the company in not seeing a big drop in the topline. Despite the price increases, the company has not seen any big impact on the volumes. It has seen good traction in urban as well as rural markets. The growth in premium categories is faster than the bottom of the pyramid. Britannia’s adjacent businesses have continued to perform well in Q1FY23. Cakes have grown in double-digit in volume as well as value terms. Dairy business has also seen double-digit growth in the quarter with “Winkin Cow” growing at 140.0% YoY. Britannia has consistently gained market share over the last 36 quarters. Market share gain was better in rural than urban, as Britannia further expanded its rural reach which now stands at 27,000 rural preferred dealers.

Commodities such as Wheat & Industrial fuel witnessed sequential inflation in the range of 15.0% to 20.0% in Q1FY23. To mitigate the impact of cost inflation, Britannia has taken continuous price increases in Q1FY23 as well as Q2FY23. It has also accelerated its cost efficiency programs and plans to deliver cost savings to the tune of 3.0% of revenue in FY23. Softening of commodity prices and full effect of the price increases taken by Britannia should result in margin improvement in coming quarters.

Q1FY23 had consumer food price inflation of 8.0% YoY. By 30th June 2022, wheat inflation has come down to 50.0%. Similarly, for palm oil, on the same base of Q3FY21, inflation for Q4FY22 / Q1FY23 was 80.0%/ 90.0% respectively, which came down to 50.0% by 30th June 2022. Other key raw materials such as industrial fuel and packing material also saw QoQ jump in inflation in Q1FY23. To mitigate the cost inflation, Britannia has taken price increases. Britannia has seen market share gains consistently over last 36 quarters and seeing good performance in rural India as well. Britannia is seeing good traction in Adjacent businesses with double-digit volume & value growth in cakes, profitable growth in breads, double digit growth in dairy, national scale up for croissants, and good performance in international markets. In the domestic business, currently the contribution of biscuits and bakery adjacencies is 80%: 20% respectively. Cost efficiency efforts in Q1FY23 were on the lines of reduction in distance to market, improvement in truck utilization, reduction in power costs, and reduction in market returns.

The shares of Britannia Industries Limited are trading at Rs. 3639, down by 1.01%.

Valuations:

The return on equity (ROE) is 49.7% for the quarter ended June 2022. The price-to-earning (P/E) ratio stood at 59.8. The return on capital employed (ROCE) for the company is 41.5%. The price to book value of Britannia Industries Limited is 34.2. The EV/EBITDA is 38. EPS during the quarter came at Rs. 61.1.

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