Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- JTL Industries Ltd (BOM:534600, Financial) achieved a total income of INR 4,874 million in Q2 FY25, reflecting resilience and adaptability in the market.
- The company reported a profit after tax of INR 264 million for Q2, with a PAT margin of 5.4%.
- Sales volumes reached 1,03,193 tonnes, marking a solid growth of 26% compared to the same quarter last year.
- Value-added products constituted 25% of the total sales mix, indicating a focus on higher-margin offerings.
- The company successfully raised INR 300 crores through QIP for capacity expansion, working capital, and general corporate purposes.
Negative Points
- JTL Industries Ltd faced an inventory loss of INR 900 to INR 930 per tonne this quarter.
- The company did not offer additional discounts to compete with larger companies, potentially affecting market share.
- Integration of Nava sales volumes into overall sales is delayed due to benefits from the Punjab government.
- The company anticipates a 10% increase in sales volume in Q3 and Q4, which may be challenging given market conditions.
- There is uncertainty regarding the exact percentage of value-added products in the sales mix for FY26 due to ongoing capacity expansions.
Q & A Highlights
Q: What was the inventory loss in this particular quarter?
A: Inventory loss was to the tune of INR 900 to INR 930 per tonne this quarter. - Pranav Singla, Executive Director
Q: How is JTL Industries responding to market strategies involving discounts and volume pushes by competitors?
A: JTL Industries focuses on maintaining margins and does not engage in price wars. We have not offered additional discounts beyond what larger companies provide. - Pranav Singla, Executive Director
Q: When will Nava sales be fully integrated into JTL Industries' sales volumes?
A: Nava sales will be integrated within this quarter (Q3), and we will no longer report them separately. - Pranav Singla, Executive Director
Q: What is the sales volume growth target for FY26?
A: We are targeting a 30% year-on-year growth in sales volume for FY26, maintaining our previous sales targets. - Pranav Singla, Executive Director
Q: How confident is JTL Industries in achieving the 40% target for value-added products in FY25?
A: We are confident in reaching the 40% target for value-added products by year-end, supported by the start of the DFT line and increased exports. - Pranav Singla, Executive Director
Q: What is the current primary versus secondary product mix, and will it change with expansion?
A: Currently, the mix is 53% secondary and 47% primary. With expansion, the mix will shift to 20% secondary and 80% primary. - Pranav Singla, Executive Director
Q: How does JTL Industries view the impact of Chinese competition on exports?
A: We face minimal competition from Chinese products in our export markets due to anti-dumping duties. We are able to import raw materials duty-free for export purposes, maintaining competitiveness. - Vikash Singh, Analyst
Q: What is the expected CapEx outlay for the second half of FY25?
A: The expected CapEx outlay for H2 FY25 is around INR 120 to 150 crore, potentially stretching up to INR 200 crore. - Pranav Singla, Executive Director
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
