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One 97 communication Q2FY24 result updates
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 28, 2023

Strategic Partnerships Fuel One97's Financial Turnaround

Strategic Partnerships Fuel One97’s Financial Turnaround

Company Name: One 97 Communication Ltd | NSE Code: PAYTM | BSE Code: 543396 | 52 Week high/low: 998/440 | CMP: INR 889 | Mcap: INR 56,647 Cr | P/Sales: 7.86x

Company Overview:

One97 Communications is engaged in the business of offering a) payment and financial services, encompassing payment facilitator services, facilitating consumer and merchant lending, wealth management, and related financial solutions. b) Additionally, the company provides commerce and cloud services, serving as an aggregator for digital products, managing ticketing operations, supplying voice and messaging platforms to telecom operators and enterprise customers, among other business activities.

Robust Revenue Growth Fueled by GMV and Merchant Payments:

One97 Communications reported a robust 31.6% YoY revenue increase to Rs. 2,519 crore in Q2FY24, driven by a surge in Gross Merchandise Value (GMV) and a 47.6% YoY jump in payments to merchants. The net payment margin rose by 60.0% YoY to Rs. 707 crore, mainly due to a significant increase in non-UPI payments. The company’s adaptability in a dynamic market is evident despite a slightly lower growth rate compared to the previous quarter.

Thriving Financial Services and Loan Disbursement Business:

One97 Communications reported robust Q2FY24 financials with a 63.6% YoY growth, totaling Rs. 571 crore. The surge was driven by a 44% YoY increase in loan disbursements, reaching 13.2 million, fueled by Paytm’s active user base. The total value of disbursed loans rose by 122% YoY to Rs. 16,211 crore, showcasing the company’s success in diversifying revenue streams and leveraging its user base for sustained growth.

Strong growth in contribution profit leads to margin expansion

The loan distribution business and improved net payment margin drove a significant uptick in Q2FY24 EBITDA before ESOP cost to Rs. 153cr, compared to a loss of Rs. -167cr in Q2FY23. A consistent 69.2% YoY growth in contribution profit led to an adjusted EBITDA margin rise from -8.7% to 6.1%. In the same period, profit attributable to shareholders improved from Rs. -571cr to Rs. -291cr, indicating a positive turnaround in financial performance.

Valuation and key ratio

The company’s stock is trading at 7.84x its sales, reflecting a market valuation of 7,203 Crore INR at the current share price of 889 INR. Additionally, the company is valued at 4.53x its book value, amounting to 196 INR per share. However, financial indicators reveal challenges, with a negative ROE and ROCE at -13.9% and -13.5%, respectively. The interest coverage ratio is a concerning -48.2x, indicating potential solvency issues.

Key concall highlight

➡️In Q2, Tata Capital joined as a lending partner, bringing the total number of NBFCs and banks to nine for credit card and loan distribution.

➡️Q2FY24 witnessed a 19% YoY increase in Average Monthly Transacting Users (MTUs), reaching 9.5 crore. Merchant subscriptions showed robust growth, surging 91% YoY to 9.2 million.

➡️The cash balance strengthened to Rs. 8,754 crore in September, up from Rs. 8,367 crore in June, attributed to improved EBITDA and working capital. The company anticipates adding more partners in the upcoming quarters.

Q2FY24 result update: Consolidated

➡️In Q2FY2, the consolidated revenue witnessed robust growth, surging by 31.6% YoY (+7.6% QoQ) to reach 2,519 Cr. This growth was primarily driven by a strong uptick in merchants’ subscription revenue, increased loan disbursements, and a rise in Gross Merchandise Value (GMV).

➡️The Adjusted EBITDA before ESOP cost exhibited remarkable expansion, soaring by 191.6% YoY (+82.5% QoQ) to 153 Cr, compared to a loss of -167 Cr in Q2FY23. This impressive performance was fueled by consistent growth in contribution profit (+69.2% YoY), resulting in an improved adjusted EBITDA margin of 6.1%, a significant positive shift from -8.7% in Q2FY23.

➡️EBITDA demonstrated a notable YoY increase of 57%, but experienced a QoQ decline of 21.1% to -231 Cr, primarily attributed to higher ESOP costs.

➡️The Operating Profit (EBIT) saw a YoY decrease of 36% (-9% QoQ) to -411 Cr, primarily due to a substantial 72.7% YoY increase in depreciation expenses.

➡️Reported Profit After Tax (PAT) declined by 49% YoY (-18.6% QoQ) to -292 Cr, driven by elevated ESOP costs and depreciation.

Conclusion:

One97 Communications demonstrated robust Q2FY24 performance with a 31.6% YoY revenue increase, driven by strong growth in financial services, merchant payments, and loan disbursements. The company’s adaptability and strategic partnerships, such as with Tata Capital, contributed to positive results, leading to a notable turnaround in financial performance, reflected in improved EBITDA margins and a strengthened cash balance. Despite a QoQ decline in some metrics, One97 Communications remains well-positioned for sustained growth, focusing on expanding its partner network and capitalizing on its active user base.

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Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

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Kokuyo Camlin Q2FY24 result update
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 24, 2023

Resilient Kokuyo Camlin: Impressive Profit Growth Amid Q2

Resilient Kokuyo Camlin: Impressive Profit Growth Amid Q2

Company Overview:

Kokuyo Camlin, a renowned company specializing in the production and marketing of stationery and art products, has a robust background. The company, now majority-owned by the Japanese stationery giant Kokuyo with a 74.4% stake, boasts an extensive product portfolio, including writing instruments, notebooks, marker pens, inks, fine-art colors, and various other stationery products.

Robust Manufacturing Facilities

Operating three manufacturing sites in Patalganga, Tarapur, and Jammu, the company’s Patalganga facility leads in production volume with over 324 SKUs annually. Tarapur follows with 800 SKUs, and the Jammu plant contributes 393 SKUs. Kokuyo Camlin caters not only to the local market but also exports its products to other countries.

Camlin Leads Stationery Market with 54% Paper, 34% Non-Paper Share

The stationery market is composed of two main categories: paper and non-paper stationery products. Camlin dominates the stationery market with a 54% market share in paper and 34% in non-paper. The paper industry, valued at ₹21,000 Crores, witnesses an 8% growth, with Camlin contributing ₹11,500 Crores. In the ₹17,500 Crores non-paper industry, Camlin holds a share of ₹6,100 Crores, in a market growing at 7.6%. Overall, the industry has shown significant growth.

Top-Line Momentum Sustained YoY while Dip QoQ in Q2FY24

In Q2FY24, the company reported a revenue of 194.8 Cr, marking a 2.6% YoY growth but a 17.3% QoQ decline. Despite moderate growth in top line, the management maintained raw material expenses, resulting in a 6.4% YoY boost in gross profit to 77.4 Cr, but down 12.2% QoQ.

Despite top line challenge, PAT up147% YoY on Lower Finance Cost & Tax Rate

Despite moderate top-line growth, Profit After Tax (PAT) soared by an impressive 147% YoY to 9.5 Cr, though it experienced a 48.3% QoQ downturn. This remarkable bottom-line growth was driven by decreased interest expenses, which fell 43.3% YoY and 58.8% QoQ to 0.47 Cr, and a lowered tax rate, dropping to 24% compared to 60% in Q2FY23.

Valuation and Key Ratios:

Presently, Kokuyo Camlin trades at a multiple of 40.3x EPS (TTM) 4 Rs at a market price of 161 Rs, with the industry PE standing at 26.2x. The company is trading at 5.64x its book value of 28.6 Rs per share. In the EV/EBITDA multiple, it ranks third among its top peers with a multiple of 21.7x, while the industry median is at 15.3x. The trailing twelve-month Return on Equity (ROE) and Return on Capital Employed (ROCE) stand at 9.26% and 12%, respectively. The interest coverage ratio in Q2FY24 stands at 27.4x, indicating the company’s solvency.

Q2FY24 Results Updates: Standalone

➡️In Q2FY24, revenue grew by 2.6% YoY but experienced a 17.4% QoQ decline to 194.8 Cr. Despite the moderate revenue growth, gross profit increased by 6.4% (down 12.2% QoQ) to 77.4 Cr, driven by prudent management of raw material costs.

➡️Gross margin showed improvement, rising 233 basis points (bps) QoQ and 140 bps YoY to 39.7% in Q2FY24 compared to 37.4% in the previous quarter.

➡️EBITDA increased by 18% YoY (down 28.6% QoQ) to 17.3 Cr, attributed to low raw material costs and operating leverage. The EBITDA margin, up 115 bps YoY but down 140 bps QoQ, stood at 8.9% in Q2FY24.

➡️Operating profit (EBIT) witnessed a YoY growth of 23.4% (down 35.6% QoQ) to 12.9 Cr, with the EBIT margin up 111 bps YoY but down 188 bps, standing at 6.6% in Q2FY24.

➡️PAT surged impressively by 147% YoY (down 48.3% QoQ) to 9.5 Cr, driven by lower interest costs (down 43.3% YoY), increased other income, and a reduced tax rate.

➡️Earnings Per Share (EPS) for the quarter stood at 0.95 Rs compared to 1.84 Rs in the previous quarter.

Conclusion:

Kokuyo Camlin, a leading stationery and art products company, faces QoQ revenue decline but sustains YoY growth. Despite top-line challenges, prudent cost management boosts gross profit and results in an impressive 147% YoY increase in PAT. The company trades at a PE of 40.3x, showing a premium compared to the industry. Key highlights include improved gross margin

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Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

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Navigating Innovation: Tata Technologies in Engineering Excellence and Risk Mitigation
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 23, 2023

Navigating Innovation: Tata Technologies in Engineering Excellence and Risk Mitigation

Navigating Innovation: Tata Technologies in Engineering Excellence and Risk Mitigation

Tata Technologies Limited is an Indian multinational company that provides engineering and design services, product lifecycle management, manufacturing, and IT service management to the automotive and aerospace industries. It has a global presence, with offices in 19 countries.

Company Overview:

Tata Technologies, founded in 1989, has established itself as a prominent player in the field of engineering solutions. With a history spanning several decades, the company has built a reputation for delivering innovative and reliable services to its clients. Specializing in engineering solutions, Tata Technologies has become a trusted partner for some of the global leaders in the automotive and aerospace industries.

The company’s client portfolio includes renowned names such as Jaguar Land Rover, Ford, Fiat Chrysler Automobiles, Airbus, and Boeing, showcasing its ability to collaborate with major Original Equipment Manufacturers (OEMs). Over the years, Tata Technologies has likely contributed significantly to the development and advancement of technology in the automotive and aerospace domains. The company’s focus on innovation and engineering excellence has likely played a pivotal role in shaping its success and maintaining long-term relationships with industry leaders.

Tata technologies core services:

1. Engineering, Research and Development (ER&D):
Tata Technologies’ ER&D services are focused on assisting global manufacturing customers throughout the product development lifecycle. This involves conceptualization, design, and development to create improved and sustainable products. The emphasis on sustainability suggests a commitment to environmentally conscious engineering solutions.

2. Digital Enterprise Services (DES):
The Digital Enterprise Services are tailored to help manufacturing customers leverage technology for various aspects of their operations. This includes identifying and deploying technologies, tools, and solutions to enhance manufacturing processes, service delivery, and overall product realization. This aligns with the modern trend of digital transformation in manufacturing.

3. Education Offerings:
Tata Technologies collaborates with universities and governments to contribute to the education sector. The company plays a role in equipping the next generation of engineers with the skills needed in the manufacturing industry. Additionally, offering a digital learning system to businesses and individuals reflects a commitment to addressing training needs in a dynamic digital environment.

4. Products and Value Added Reselling (VAR):
Tata Technologies assists its customers in identifying and deploying product development software from partners. Acting as a Value Added Reseller (VAR), the company adds value to these products, helping customers manufacture, service, and bring superior products to market successfully

Tata Technologies Industries: Driving Excellence Across Sectors-

 Automotive Innovation:
Navigating the automotive industry’s radical transformation, Tata Technologies delivers end-to-end solutions. From electric vehicle engineering to digital transformation, their expertise spans the entire automotive value chain. They accelerate product launches, optimize operations, and enhance customer experiences, shaping a connected, autonomous, shared, and electric future.

 Global Industrial Heavy Machinery (IHM):
In a shifting Industrial Heavy Machinery landscape, Tata Technologies provides comprehensive solutions. Their offerings, covering engineering, manufacturing, and customer experience, empower manufacturers to meet global infrastructure demands efficiently. Leveraging digital enterprise solutions, they minimize production costs, accelerate time to market, and guide their clients towards Industry 4.0.

 Aerospace Advancements:
As the aerospace industry undergoes a transformative phase, Tata Technologies contributes cutting-edge solutions. Their aerospace portfolio spans engineering, manufacturing, and customer services, addressing the industry’s need for innovative, high-precision products. With advanced technologies and a focus on customer experiences, they redefine excellence in aerospace engineering and services.

Risk factors associated with tata technologies:

 Dependence on key clients: Tata Technologies’ business is strongly reliant on a few important customers, notably Jaguar Land Rover, Ford, Fiat Chrysler Automobiles, Airbus, and Boeing. If any of these clients reduces their spending or switches to a new provider, Tata Technologies’ revenue and profitability could suffer significantly.

 Exposure to global economic conditions: As Tata Technologies works in a global market, it is subject to swings in global economic conditions. A faltering global economy could result in lower demand for Tata Technologies’ services, significantly impacting its financial performance.

 Technological advances: The engineering services business is continually evolving, with new technologies arriving on a regular basis. To be competitive, Tata Technologies must be able to keep up with these changes. If it does not, it risks losing clients to more innovative competition.

 Currency fluctuations: Tata Technologies operates in a number of countries worldwide, and its revenue is denominated in a number of currencies. Exchange rate fluctuations might have an impact on the company’s performance.

 Regulatory risks: In the countries where it works, Tata Technologies is subject to a range of rules. Changes in this legislation may have an impact on the company’s ability to operate in certain markets.

 Project risks: Projects at Tata Technologies are frequently difficult and require a high level of technical competence. If a project fails to reach its goals, it may result in financial losses and damage to the company’s reputation.

 Talent acquisition and retention: Tata Technologies’ services are delivered by a competent staff. If the organization is unable to attract and retain great personnel, its ability to compete in the market may suffer.

 Financial investment: The corporation invests in unsecured debt instruments on occasion, including those with interest rates lower than the market rate, which has an impact on profitability. These investments include a variety of financial products. Inter-corporate deposits are held solely by the Promoter and are repayable on demand.

 Cash flows and projections: Recognizing previous negative cash flows and projecting future negatives, the business recorded negative net cash flow from operational activities for Fiscal 2022 and the six-month period ending September 30, 2023. The negative operating cash flow in Fiscal 2022 was related to the use of client advances to pay vendors. Similarly, the latter period’s negative cash flow was caused by greater advances to suppliers.

Tata technologies partnerships:

1. Mobility in Harmony (MIH) Consortium: Tata Technologies is a member of the Mobility in Harmony (MIH) consortium, indicating its commitment to engineering sustainable mobility solutions and contributing to the acceleration of innovation in future mobility.

2. PTC: Tata Technologies collaborates with PTC, a company focused on making digital transformation a reality for businesses. In this partnership, Tata Technologies serves as a system integrator (SI) and a reseller for PTC, likely working on customized innovations that deliver maximum business advantage.

3. Kovair: Tata Technologies has a partnership with Kovair, a company specializing in enabling digital transformation through DevOps solutions and enterprise tools integrations for embedded software development. As a system integrator (SI) and reseller for Kovair, Tata Technologies likely plays a role in integrating Kovair’s solutions into their services.

4. Codincity: Codincity is Tata Technologies’ cloud and digital partner. This partnership suggests that Tata Technologies is harnessing the power of the cloud to support its customers’ digital transformation journeys. The collaboration with Codincity may involve utilizing cloud technologies to enhance Tata Technologies’ offerings.

5. Logility: Tata Technologies serves as a system integrator (SI) for Logility, focusing on delivering a digital and sustainable supply chain. This partnership aims to empower customers to grow and compete through advanced supply chain solutions.

6. Dassault Systèmes: Tata Technologies acts as a reseller for Dassault Systèmes, a company known for developing product development applications. This collaboration enables Tata Technologies to offer a range of tools and solutions that help customers thrive throughout the entire product lifecycle.

7. SAP: Tata Technologies has a partnership with SAP, where it functions as a sell partner. SAP is renowned for transforming enterprise processes, enhancing customer satisfaction, and enriching employee experiences. Through this collaboration, Tata Technologies likely provides SAP solutions to its clients.

8. Siemens: Tata Technologies plays a dual role as a system integrator (SI) and a reseller for Siemens. Siemens is recognized for empowering companies to embrace complexity, leveraging it to enhance productivity and gain a competitive advantage. This partnership positions Tata Technologies to integrate Siemens’ solutions and serve as a reseller. 

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Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

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Neogen Chemicals Ltd Q1FY24 results updates
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 23, 2023

Neogen Q2FY24: Resilient Top-Line Amid Export Market Slowdown

Neogen Q2FY24: Resilient Top-Line Amid Export Market Slowdown

Company Overview:

Neogen Chemicals specializes in the production of specialty chemicals for the pharmaceutical, engineering, and agro-chemical industries. Offering 248 products to domestic and international markets, the company operates four manufacturing sites and two R&D facilities. With a total production capacity of 463 liters cubic meters in organic chemicals and 39 liters cubic meters in inorganic chemicals, Neogen Chemicals exports to 29 countries, with the USA, Europe, and Japan contributing 31% to revenue in Q2FY24.

Capacity expansion in existing and battery business & Current project updates

In its existing business, Neogen Chemicals increased organic chemical capacity by 60,000 liters and inorganic chemical capacity from 1,200 MT (15 m^3) to 2,400 MT (30 m^3). In the battery chemical business, a new capacity of 400 MTPA was added for manufacturing Lithium Electrolyte Salts & Additives. The company aims to commission 29 m^3 of chemicals by March 2024, with an additional 31 m^3 commissioned by Q4FY24. This expansion is complemented by a recent fund raise of 253 Cr, which is expected to reduce finance costs.

Debt repayment from recent funds is expected to cut finance costs

In Q2FY24, the company successfully raised 253 Crores through preferential allotment, a strategic move aimed at retiring some existing debt. This capital infusion contributed to a reduction in interest costs in the near term. However, in the most recent quarter, PAT experienced a decline of 7.6% Year-over-Year (YoY) and a significant 20% Quarter-over-Quarter (QoQ) decrease, amounting to 9.14 Crores. This decrease in PAT can be attributed to escalated interest costs and increased depreciation during the period.

Despite a slowdown in the export market, top-line momentum continues to sustain.

Despite challenges such as global inventory destocking, a slowdown in the export market, and geopolitical uncertainties, Neogen Chemicals sustained a standalone revenue growth of 13.1% YoY (-1.1% QoQ) to 168 Cr in Q2FY24. This resilient top-line performance is attributed to recent capacity expansions and contributions from Buli chemicals.

Enhanced EBITDA (8.21% YoY) through Product Mix Optimization:

The company reported a standalone EBITDA of 26.2 Cr, marking an 8.21% YoY increase (-10.9% QoQ). This growth is attributed to an improved product mix and rationalization of raw material costs. While EBITDA margins experienced a slight decline, the overall operational efficiency improved.

Valuation and Key Ratios:

Neogen Chemicals is currently trading at a multiple of 77.5x EPS (TTM) at a market price of 1,542, with an industry PE standing at 32.7x. The company’s trading at 7.74x its book value of 199 Rs per share. The trailing twelve-month ROE and ROCE stand at 10.9% and 13.2%, respectively. In terms of EV/EBITDA multiple, the company ranks 4th among its top 8 peers, with a multiple of 34.4x, compared to the industry median of 16.1x. The interest coverage ratio of 1.98x in Q2FY24 signifies the company’s solvency.

Q2FY24 Results Updates: Standalone

➡️In Q2FY24, standalone revenue grew 13.5% YoY (-1.1% QoQ) to 168 Cr despite a slowdown in the export market, driven by an increase in capacity expansion.

➡️Gross profit grew 3.8% YoY to 71.9 Cr, with a 22.1% YoY increase in COGS. However, gross margin declined by 400 bps YoY to 42.7%.

➡️EBITDA boosted 8.2% YoY (-10.9% QoQ) to 26 Cr led by improved product mix. EBITDA margin down 78 bps YoY (172 bps QoQ) to 15.6%.

➡️Operating profit (EBIT) grew 4.61% YoY and down 13.1% QoQ to 21 Cr due to an increase in depreciation (27% YoY) with several CAPEX initiatives.

➡️PAT is down by 7.58% YoY (-20% QoQ) to 9 Cr on account of higher finance costs and depreciation.

➡️EPS for the quarter stood at 3.67 Rs while the previous quarter was 4.59 Rs.

Conclusion:

Neogen Chemicals, specializing in specialty chemicals, demonstrated resilience in Q2FY24 with sustained revenue growth despite global challenges. Capacity expansions in existing and battery businesses, coupled with successful debt repayment and enhanced EBITDA, contribute to the company’s positive outlook. While facing a decline in PAT due to increased finance costs, Neogen remains strategically positioned for future growth.

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Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

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PTC India Q2FY24 results update
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 22, 2023

PTC India's Q2FY24: Resilient Growth in Power Trading and Financing Operations

PTC India’s Q2FY24: Resilient Growth in Power Trading and Financing Operations

Company Overview:

PTC India is primarily engaged in power trading, generation, and providing financing services across the energy value chain, including projects in generation, transmission, and distribution. Its financing business operates through the subsidiary company PTC India Financial Service Ltd (PFSL), registered as an NBFC with RBI. Additionally, its subsidiary PTC Energy Ltd (PEL) is involved in the import and export of coal, fuels into electricity, fuels linkages, and provides advisory services in the energy sector.

Moderate growth in volumes (1.45% YoY), while core margins rises by 16.1% YoY

Power trading volumes experienced a slight YoY increase of 1.45% to 21,316 million units, with core margins seeing a significant rise of 16.1% YoY to 3.96 paisa per unit. The increase in volumes from long-term and medium-term contracts offset the decline in short-term contract volumes. Long-term and medium-term contracts now constitute 53% of total volumes in Q2FY24.

EBITDA Rises by 29.8% YoY led by higher surcharge income

PTC India reported a standalone EBITDA of Rs 118 Cr, reflecting a substantial YoY increase of 29.8% and a QoQ growth of 5.7%. This growth was primarily led by higher surcharge income, amounting to Rs 34.5 Cr compared to Rs 11.8 Cr in Q2FY23. Operating expenses also showed a notable decline of 40% YoY. Standalone PAT surged by an impressive 113.3% YoY (48.4% QoQ) to Rs 133 Cr, attributed to higher surcharge income and a lower effective tax rate.

Power Trading Volume Mix in Q2FY24

As of Q2FY24, long-term and short-term contracts collectively account for 98% of total trading volumes, with long-term contracts constituting 53% and short-term contracts 45%. Medium-term contracts contribute a minor 2% to the total trading volume.

Valuation and Key Ratios:

Currently trading at a multiple of 8.91x EPS (TTM) of Rs 17.6, PTC India’s market price of 156 implies a significant undervaluation and industry PE stands at 35.6x. With a book value of Rs 172 per share, the company is trading at 0.9x its book value. In terms of EV/EBITDA multiple, PTC India is notably undervalued among its peers at 6.2x, while the median EV/EBITDA for the industry is 19.2x. Trailing twelve months ROE and ROCE stand at 9.03% and 9.21%, respectively, indicating the company’s solvency. The interest coverage ratio is at a comfortable 2.36x.

Q2FY24 Results Updates: Standalone

➡️Power trading volumes saw a slight YoY increase of 1.45% to 21,326 million units, attributed to a decline in short-term contract volumes and a rise in long-medium term contracts.

➡️Revenue for Q2FY24 grew by 6.04% YoY (6.80% QoQ) to Rs 4,880 Cr, driven by higher volumes and surcharge income.

➡️EBITDA increased significantly by 29.8% YoY (5.75% QoQ) to Rs 118 Cr, primarily due to higher surcharge income and reduced operating expenses.

➡️Other income experienced a remarkable YoY growth of 18x and a QoQ increase of 379% to Rs 50 Cr, including a dividend of Rs 41.7 Cr received from a subsidiary company during the quarter.

➡️PAT surged by an impressive 113.2% YoY (48.4% QoQ) to Rs 133 Cr, led by higher surcharge income and a lower tax rate.

➡️EPS for the quarter stood at Rs 4.51, compared to Rs 3.03 in Q2FY23.

Conclusion:

PTC India has demonstrated resilience and growth in its power trading and financing operations in Q2FY24. The company’s strategic focus on long and medium-term contracts has mitigated the impact of declining short-term volumes. With a notable rise in EBITDA, substantial surcharge income, and prudent cost management, PTC India positions itself as a strong player in the energy sector. The undervaluation indicated by key ratios, coupled with a robust financial performance, suggests positive prospects for investors.

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Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

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PFC Q2FY24 result updates
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 21, 2023

Robust Loan Book Growth and Strategic Lending Drive PFC's Stellar Q2FY24 Results

Robust Loan Book Growth and Strategic Lending Drive PFC’s Stellar Q2FY24 Results

Company Overview:

PFC Ltd is a government Non-deposit-taking NBFC company primarily focused on providing finance to the power, logistics, and infrastructure sectors. Additionally, it offers consultancy services to the power sector, facilitating the development of ultra mega power projects and independent transmission projects.

Strong Loan book growth – 19% QoQ & disbursement grew 2.5x

In Q2FY24, PFC achieved an impressive 19% QoQ growth in its loan book, reaching 4,50,000 Cr as of September 30, 2023. The YoY growth is noteworthy, driven by a consistent increase in disbursements, particularly in H1FY24, where disbursements grew 2.5x compared to the previous year, standing at around 55,500 Cr. This growth is primarily attributed to lending in the distribution sector and towards renewable energy projects.

Yield expansion moderate, while rise in funding cost pull down margins

The yield in H1FY24 stood at 9.92%, showing a moderate 7bps increase from Q1FY24. However, a simultaneous 11 bps rise in the cost of funds to 7.41% led to a 3.11% YoY decline in Net Interest Income (NII) (+6.44% QoQ). Despite this, the Net Interest Margin (NIM) for the quarter stood at 3.37%, and the interest spread at 2.51%, both within the company’s target range.

Asset quality improved & CRAR sustained above 24% reflect strong capital position

Maintaining the highest level of asset quality, PFC added no new NPA in the last six years, with an NNPA ratio standing at 1%, the lowest in six years. GNPA levels have also decreased from 4.75% in H1FY23 to 3.67% in H1FY24. As of September 2023, the Capital to Risk (Weighted) Assets Ratio (CRAR) stands at a robust 24.86%, marking a 57 bps increase from Q2FY23 levels.

Hedging portion has improved to minimise exchange risk – INR depreciation

PFC has enhanced its hedging strategies, minimizing exchange risks associated with INR depreciation. The company booked a foreign translation loss of Rs 119 Cr in Q2FY24, with 83% of the foreign currency portfolio hedged for exchange risk, compared to 68% in Q2FY23. Additionally, 100% of U.S. dollar exposure maturing in the next five years has been hedged.

On going projects worth INR 16,497 Cr in stage 3

Presently, the company has 22 stressed projects in stage 3, totaling INR 16,497 Cr. Notably, 13 projects worth INR 13,899 Cr have been successfully resolved under NCLT. Two projects in advanced stages include the Lanco Amarkantak project and the Dans Energy project, with resolution plans finalized and documentation processes underway.

Late Payment Surcharge (LPS) Scheme: Bolstering Financial Discipline in Discoms

In the realm of government initiatives, the Late Payment Surcharge (LPS) scheme spearheaded by the company has made significant strides. With a sanctioned corpus of 70,500 Cr, an impressive 31,500 Cr has already been disbursed. Notably, this scheme has achieved remarkable success, evidenced by a substantial 50% reduction in legacy dues owed by discoms to generation companies. Moreover, it has facilitated the clearance of current dues, thereby enhancing the financial discipline of discoms. The LPS scheme emerges as a pivotal instrument in fostering fiscal responsibility among discoms.

Revamped Distribution Sector (RDSS): Catalyzing Modernization and Financial Health

On another front, the Revamped Distribution Sector (RDSS) stands as a testament to the company’s commitment to modernizing discoms and fortifying their operational efficiencies and financial health. Aligned with the national electricity plan, which envisions approximately 33 lakh Cr of investments in the power sector by 2032, the RDSS is strategically positioned. As a key player, the company is actively contributing to this vision, ensuring that discoms evolve into robust entities capable of meeting the challenges of the evolving energy landscape. The RDSS is a holistic approach toward the sustainable development of the power sector.

Medium to Long-Term Growth Outlook: Tapping into a Multifaceted Opportunity

Zooming out to assess the broader landscape, the medium to long-term growth outlook reveals a vast opportunity for the company. As per the national electricity plan, a staggering 33 lakh Cr of investments are slated for the power sector by 2032. PFC currently holds the mantle as the largest lender for the renewable sector, having bolstered 25% of the current installed renewable capacity. With an eye on the future, the company anticipates maintaining this significant share in energy transition financing within the power sector. This foresight positions the company as a pivotal player in driving sustainable growth and development.

Striving for 500 Gigawatts by 2030: PFC’s Ambitious Renewable Energy Vision

Looking ahead, PFC is steadfast in its commitment to achieving a monumental milestone – 500 gigawatts by 2030. Currently boasting a formidable 187 gigawatts, the company has already disbursed a substantial 1 lakh Cr in funding to the renewable sector, commanding a noteworthy 25% market share in the current installed renewable capacity. The ambitious pursuit of 500 gigawatts underscores PFC’s pivotal role in steering the renewable energy trajectory. As a stalwart in the sector, the company is poised to play a pivotal role in shaping the future of renewable energy in the country.

Valuation and Key Ratios

Currently company Trading at 1.14x of its book value at Rs 283 per share at current market price 320. PFC’s trailing twelve months ROE and ROCE stand at 20.4% and 9.08%, respectively. The Interest Coverage Ratio at 1.58x reflects the company’s solvency.

Q2FY24 Result Highlights: Standalone

➡️ In Q2Y24, Interest income grew 12.1% YoY (+5.6% QoQ) to 10,692 Cr while interest expenses grew 22.5% YoY (+5.1% QoQ) to 6,963 Cr

➡️ As a result, NII grew 6.4% QoQ but declined 3.1% YoY to 3,729 Cr due to higher cost of funds.

➡️ Other income grew 101.1% YoY and 60x QoQ to 1,096 Cr includes dividend income of 1,074 Cr and fees & commission income of 20.3 Cr.

➡️ PPOP increased by 22.6% YoY (+27.6% QoQ) to 4,686 Cr supported by operating leverage benefit and healthy growth in other income.

➡️ PAT surged 28.3% YoY (+27.9% QoQ) to 3,847 Cr, supported by lower provisions, operating leverage benefit, and robust growth in other income.

➡️ EPS for the quarter stood at 11.6 Rs, a significant improvement from the previous quarter 9.1 Rs and Q2FY23.

conclusion

PFC Ltd demonstrates robust financial performance with significant loan book growth, prudent asset quality management, and strengthened hedging strategies. Despite a margin challenge, the company maintains a healthy capital position. The successful resolution of stressed projects and impressive Q2FY24 results further underscore PFC’s resilience and strategic positioning in the non-deposit-taking NBFC sector.

FB’s Q2FY24 PAT jumps to Rs 954 Cr on lower Provisions

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RBI's Regulatory Shift: Cross-Border Payments and Compliance in India
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 21, 2023

RBI's Regulatory Shift: Cross-Border Payments and Compliance in India

RBI’s Regulatory Shift: Cross-Border Payments and Compliance in India

Introduction:

The Reserve Bank of India (RBI) plays a crucial role in regulating and overseeing the Indian financial system. In recent years, the Reserve Bank of India (RBI) decided to bring cross-border payment aggregators (CB-PAs) under its direct supervision in order to enhance oversight and promote a safer and more robust cross-border payment ecosystem in India. Prior to this move, CB-PAs were only required to partner with an authorized dealer bank in India to facilitate cross-border payments. However, the RBI recognized that the growing volume and complexity of cross-border transactions necessitated a more stringent regulatory framework.

Cross-border payment aggregators (PA-CBs) will need a license from the Reserve Bank of India (RBI) to operate under the new criteria. Existing providers of online payment gateway services (OPGSPs) must apply for the license by April 30, 2024. Notably, before registering with the RBI, non-bank PA-CBs must also register with the Financial Intelligence Unit-India (FIU-IND). These rules supersede the draft Online Export Import Facilitators Directions released by the RBI in April 2022, which were withdrawn following consultations with industry stakeholders.

Who needs to comply with the new cross-border payment rules in India?

The new regulations apply to firms in India that facilitate online cross-border financial transactions for the import and export of approved goods and services. These entities include authorized dealer banks (AD Banks), payment aggregators (PAs), and PA-CBs that handle cross-border payments. An example would be a payment service provider that lets a foreign merchant to receive payments for things sold to a buyer in India.

Non-Bank PA Authorization Requirements-CB Service Providers:

All non-banks that provide PA-CB services must apply to the RBI for authorization as a payment system operator (PSO) under the Payment & Settlement Systems Act, 2007, by April 30, 2024. They can apply for license in one of three ways: export-only, import-only, or export and import. AD Banks that offer these services do not require a special license.

Key Requirements for Non-Bank PA-CB Providers to Obtain RBI Authorization:

1. Registration with the Financial Intelligence Unit (FIU-IND): Before seeking for RBI authorization, all non-bank PA-CBs must register with the FIU-IND. This registration assures compliance with anti-money laundering (AML) and counter-terrorism financing (CFT) requirements.
2. Minimum Net Worth:
a. Existing non-bank PA-CBs must have a net value of INR 15 crore at the time they apply for RBI permission. Furthermore, by March 31, 2026, they must boost their net worth to INR 25 crore.
b. New non-bank PA-CBs: New non-bank PA-CBs that begin operations after the circular’s publication must have a net worth of INR 25 crore by the end of the third fiscal year after gaining authorization.
3. Wind-up Requirements: Existing PA-CBs that do not achieve the net worth requirements or apply for RBI authorization within the specified timeframe must cease PA-CB operations by July 31, 2024.

Import and Export PA-CB Account Requirements:

An Import Collection Account (ICA) with an Authorized Dealer Bank (AD Bank) is required for PA-CBs. Payments for import transactions must be received by the PA in an escrow account, from which money must be transferred to the ICA for onward settlement to the offshore merchants.
PA-CBs that solely do exports must keep an Export Collection Account (ECA) with an AD bank. The ECA can be in Indian Rupees (INR) or in international currencies. Separate currency accounts must be kept for all foreign currency transactions. Only merchants who have been directly onboarded by export PA-CBs can settle transactions in currencies other than INR.

RBI’s comprehensive regulatory measures:

The RBI has imposed a significant compliance burden on Prepaid Payment Instrument Issuers (PA-CBs) by subjecting them to direct regulatory supervision of the DPSS. Considering that the domestic leg of a transaction involves cross-border payments either at the destination or origination, the RBI aims to standardize regulations across the entire spectrum of payments, covering both domestic Payment Aggregators (PAs) and PA-CBs.
In sending a clear message, the RBI emphasizes that payment processing companies must undertake robust merchant onboarding, customer complaint redressal, anti-money laundering, and information security protocols. Overall, this underscores the importance of adherence to comprehensive regulatory standards in the payment processing industry.

Conclusion:

The Reserve Bank of India (RBI) has implemented new laws in India for cross-border payment aggregators (PA-CBs). These policies are intended to improve oversight, create a more secure and resilient cross-border payment environment, and assure compliance with comprehensive regulatory standards. Registration with the Financial Intelligence Unit (FIU-IND), meeting minimum net worth requirements, maintaining specific account requirements for import and export transactions, and implementing robust merchant onboarding, customer complaint redressal, anti-money laundering, and information security protocols are key requirements for non-bank PA-CB providers to obtain RBI authorization.

https://www.equityright.com/navigating-the-economic-landscape-indias-growth-trajectory-amidst-key-risks/

 

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Riding the Tech Wave: Nasdaq's Surge Sparks Asian Stock Rally
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 21, 2023

Riding the Tech Wave: Nasdaq's Surge Sparks Asian Stock Rally

Riding the Tech Wave: Nasdaq’s Surge Sparks Asian Stock Rally

The global stock market is intricately interconnected, with events in one region often influencing markets around the world. Recently, the Nasdaq Composite Index, dominated by technology stocks, witnessed a substantial boost, driving positive momentum in the Asian stock market.

Technology stocks performed well, and benchmarks in South Korea and Australia rose slightly. Hong Kong futures began positively, led by the Golden Dragon index of US-listed Chinese companies, which gained more than 3.5%. The S&P 500 closed at its best level since August, and the Nasdaq 100 reached a 22-month high.

The Nasdaq has reached new highs as tech giants soar

In recent months, the Nasdaq Composite Index, a stock market index that tracks the performance of technology companies, has been on a tear. A number of factors, including strong earnings reports from many of the index’s largest companies, have contributed to the Nasdaq’s recent surge. Apple, Microsoft, and Alphabet (Google), for example, all reported record earnings in the third quarter of 2023, helping to boost investor confidence in the tech sector.

Aside from strong earnings, investors are bullish on the tech sector’s long-term growth prospects. As the world becomes more digital, demand for tech products and services is expected to rise, benefiting tech companies.

The Nasdaq’s outperformance can be assigned in part to its substantial weighting of technology companies. As people spend more time online and buy more tech products as a result of the COVID-19 pandemic, technology companies have been among the biggest winners.

The Nasdaq Effect on Asian Markets:


The impact of US stock prices on Asian stock markets is complex and varies depending on several factors, including the overall health of the global economy, investor sentiment, and the specific companies traded on each market. However, there is a general positive correlation between the two markets, which means that when stock prices in the US rise, so do stock prices in Asia, and vice versa.

Asian stock exchanges, including Tokyo, Hong Kong, and Shanghai, reacted positively to the
Nasdaq’s stellar performance. Boosted by the optimism surrounding the technology sector,
investors in the region increased their holdings in tech-related stocks, contributing to a broad-based rally.

Key players in the Asian stock rally:

➢ Dominance of the Technology Sector: Technology stocks were among the primary drivers of the Asian stock market rally. Companies involved in semiconductor manufacturing, software development, and e-commerce were crucial.
➢ Economic Optimism: The rise in Asian stocks reflects a broader sense of economic optimism as global economies recover from the COVID-19 pandemic’s challenges. Investors are bullish on the technology sector’s resilience and growth potential in the post-pandemic era.
➢ Investor Confidence: The Nasdaq’s performance boosted investor confidence, prompting increased participation in Asian markets. Positive market sentiment and a desire for technology-related opportunities aided the overall rally.
➢ Global connectivity: Global financial markets are like a web, with events in one country affecting markets in other countries. This was demonstrated when Asian stock prices rose following the Nasdaq’s rally. This demonstrates how major stock indices around the world are linked.

Conclusion:

The Nasdaq’s recent rise and its positive impact on Asian stock markets demonstrate the
interconnectedness of global financial markets. The strong performance of technology
companies in the United States has reverberated throughout Asia, boosting investor
confidence and fuelling a broad-based rally. As the global economy improves and demand
for technology products and services rises, Asian stock markets are well positioned to
continue rising.

https://www.equityright.com/navigating-the-economic-landscape-indias-growth-trajectory-amidst-key-risks/

 

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Celebration Economy: The Economic Impact of Weddings on Hospitality
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 20, 2023

Navigating the economic landscape: India's growth trajectory amidst key risks

Navigating the economic landscape: India’s growth trajectory amidst key risks

Introduction:

Driven by positive global trends and timely investments in energy and technology, India is expected to overtake Germany and Japan to become the world’s third-largest economy by 2027 and hold the third-largest stock market by 2030.

India’s economy has grown at the highest rate in the world over the last ten years, with an average GDP growth rate of 5.5%. This indicates that India’s economic might has been on an impressive upward trajectory. Global offshore, digitization, and the energy boom are three disruptive factors that are coming together to provide India a once-in-a-lifetime chance to boost economic growth and enable its billion-plus population to live in greater prosperity.

By 2031, India’s GDP may have surpassed $7.5 trillion, more than doubling from its current $3.5 trillion level. India is expected to become a major player in the global economy. If India’s share of global exports doubles, it would mean that the country is exporting twice as many goods as it is today. This would be a major boost for India’s economy, and it would create many new jobs for Indian workers. In the upcoming years, the market value of the Bombay Stock Exchange could reach $10 trillion, with an expected 11% annual growth. This would be a major development for India’s financial sector, and it would make the country a more attractive destination for foreign investment.

Boosting India’s production share in global markets:

India has the potential to become a global manufacturing powerhouse. The country has a large pool of young, talented workers, and it is making significant investments in infrastructure and education. As a result, India is becoming increasingly attractive to multinational companies looking to set up manufacturing operations. This could lead to a significant boost in India’s share of global manufacturing exports.

Increasing credit availability: In recent years, India has made tremendous success in increasing credit availability, and this trend is projected to continue. This will make borrowing money easier for businesses, resulting in higher investment and job growth.

Starting a new business: India is a hive of entrepreneurial activity, and this trend is likely to continue in the coming years.

Improving Life Quality: The quality of life for Indians is predicted to increase as the country’s economy grows.

Driving a boom in consumer spending: Indian consumers are anticipated to spend more money as their standard of living improves. This will increase demand for products and services, hence stimulating economic growth.

India is expected to experience significant economic growth in the coming years, with an annual output growth of over $400 billion from 2023 onwards. This growth will rise to over $500 billion annually after 2028,  India is poised to become a global economic leader, playing a significant role in shaping the global economic landscape.

 

Global Offshoring Builds a Global Workforce

Companies have been outsourcing various services, including software development, customer service, and business process outsourcing (BPO), to India for many years. This trend was initially driven by India’s lower labour costs and availability of skilled professionals. However, recent factors, such as tighter global labour markets and the rise of distributed work models, are renewing interest in India as a global outsourcing destination.

India is also on route to become the world’s factory, due to corporate tax cuts, investment incentives, and infrastructure spending, which are driving capital investments in manufacturing.

The confidence of global firms in India’s investment prospects is at an all-time high. Optimism among multinational corporations (MNCs) regarding investment prospects in India’s manufacturing sector has reached an unprecedented high. These positive trends are driving projections of a substantial rise in manufacturing’s share of India’s GDP, from the current 15.6% to 21% by 2031. Simultaneously, India’s export market share is expected to double during this period, further cementing its position as a global manufacturing powerhouse. Manufacturing’s proportion of GDP in India might rise from 15.6% to 21% by 2031, more than doubling India’s export market share.

Key risks to India’s economic growth:

1.Prolonged Global Recession:

The Indian economy is highly dependent on global demand for exports, and a prolonged global recession might have a severe influence on its growth prospects. If large countries such as the United States and Europe face a lengthy slump, demand for Indian goods and services may fall, resulting in decreased exports and slower economic growth.

2.Unfavourable Geopolitical Developments:

India is prone to geopolitical tensions and conflicts because of its geographical location in a politically volatile region. Instability and violence in a region can disrupt trade, raise security concerns, and discourage foreign investment. These elements have the potential to destroy the Indian economy, making it more difficult for businesses to plan and invest.

3.Domestic Policy Fluctuations:

Domestic policy changes in India, such as taxation, labour legislation, and environmental restrictions, can have a substantial impact on the investment climate and business environment. Unpredictable or unfavourable policy changes can discourage foreign investment and make commercial operations onerous, stifling economic progress.

4.Lack of Skilled Labor:

India’s rapid economic expansion has resulted in an increase in the demand for skilled labour, but the country’s education system is not yet completely prepared to meet this demand. This skilled labour shortage can limit the growth of some industries and make it difficult for firms to find the expertise they need to compete globally.

5.Energy Shortages:

India is a net energy importer, and rising global energy prices could put a pressure on the country’s economy. Energy scarcity can also cause power outages and disruptions in industrial production, weighing on economic growth.

6.Commodity Volatility:

The Indian economy is subject to commodity price movements, particularly oil prices. Rising oil prices can raise India’s import bill and add to inflationary pressures. Commodity volatility can also make it difficult for firms to plan ahead of time.

 

Q2FY24: Shriram Finance reports robust AUM growth Drives NII soars to 4,594 Cr

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Adani Wilmar Q2FY24 result updates
Business, Equities, Expert Views, Investor Forum, Market News, Markets, Research, Research Reports, Result Updates - November 20, 2023

Adani Wilmar navigated edible oil price fluctuations in Q2FY24, maintaining a balance between volumes and revenue.

Adani Wilmar navigated edible oil price fluctuations in Q2FY24, maintaining a balance between volumes and revenue.

Company Overview:

Adani Wilmar operates in the FMCG sector, focusing primarily on edible oils and food & other FMCG segments. The company also plays a vital role in industry essential segments such as castor, oleo, and de-oiled cake. Well-known brands under the company’s umbrella include Fortune, King’s, Kohinoor, Charminar, Jubilee, etc. As of Q2FY24, the company boasts a direct reach to over 6.5 million outlets, covering 26,500+ rural towns, indicating an aggressive expansion strategy in rural areas for future growth. Adani Wilmar owns 23 manufacturing units and leases 38, with a total refining capacity of 5.5 million tonnes and a food capacity of 0.9 million tonnes per annum.

Market leader in Edible oil – 19.6% market share

As of September 2023, Adani Wilmar holds the highest market share of 19.6% in the edible oil sector, securing a position in the top 3 for all edible oils, including Soyabean, Sunflower, Palm, Mustard, and Ricebran. The company also stands at the second and third positions in wheat flour and basmati rice, with market shares of 5.15% and 7.40%, respectively. Despite a slight dip in basmati rice market share from 9.4% in Q2FY23 to 7.4% in Q2FY24, wheat flour has seen a gain of 15 basis points, reaching 5.15% in Q2FY24.

Volumes were higher YoY for all segments, revenue was impacted by the decline in edible oil prices:

While Q2FY24 witnessed an 11% YoY growth in volumes (with a minor 2% QoQ dip to 1.5 MMT), revenue experienced a 13.3% YoY decline and a 5.1% QoQ decrease, amounting to INR 12,267 Crores. The decline in edible oil prices in Q1FY24 and Q2FY24 contributed to a 19.4% reduction in revenue for the edible oil segment. Despite a 3.7% YoY growth in volumes (and a 4.5% QoQ decline), the edible oil segment revenue reached INR 9,037 Crores. Conversely, the food & FMCG segment saw a 26.4% YoY revenue growth (16.9% QoQ) to INR 1,283 Crores, while the industry essentials segment experienced a 1.7% YoY increase but a 1.9% QoQ decline, reaching INR 1,947 Crores.

Valuation and Key Ratios:

Adani Wilmar is currently trading at a multiple of 206x EPS(TTM) at a market price of INR 291, while the industry PE stands at 33.6x. The company’s trading value is 4.75 times its book value, amounting to INR 61.3 per share. The return on equity is at 7.4%, and the return on capital employed stands at 15%. In the EV/EBITDA multiple, Adani Wilmar holds the third position among top peers, with a multiple of 25.4x. In Q2FY24, the interest coverage ratio stood at 0.22x due to a high debt of INR 220 Crores, indicating lower solvency while EBIT stood at only INR 48 Crores.

Q2FY24 Results Updates: Consolidated

➡️ In Q2FY24, revenue declined by 13.3% YoY (-5.1% QoQ) to INR 12,267 Cr, impacted by a correction in edible oil prices. However, volumes grew by 11% YoY (-2% QoQ) to 1.5 MMT.

➡️ EBITDA witnessed a 10.1% QoQ growth but declined by 43.4% YoY to INR 144 Cr. The EBITDA margin stood at 1.17%, contracting by 62 bps YoY and expanding by 16 bps QoQ.

➡️ Operating Profit (EBIT) grew by 29.9% QoQ but declined by 70.7% YoY to INR 48 Cr. The EBIT margin expanded by 10 bps QoQ but contracted by 77 bps YoY, reaching 0.39%.

➡️ PBT was at INR -172 Cr, impacted by higher interest costs of INR 220 Cr (34.8% YoY/29% QoQ).

➡️ PAT grew by 65.6% QoQ but declined by 368.1% YoY to -INR 130.7 Cr due to poor revenue growth and higher interest costs. Earnings Per Share (EPS) for the quarter stood at -INR 1.01 (PQ -0.61 Rs).

Conclusion:

Adani Wilmar, a prominent player in the FMCG sector, faces challenges with a YoY decline in revenue primarily attributed to the correction in edible oil prices. Despite volume growth and a strong market position in edible oils, the company grapples with higher interest costs impacting profitability. Investors should monitor the company’s efforts to navigate market dynamics and manage debt levels for sustainable growth in the future.

FB’s Q2FY24 PAT jumps to Rs 954 Cr on lower Provisions

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