- Revenue: INR1,910 crores in Q3 FY25 compared to INR1,898 crores in the same period last year.
- Profit Before Tax: INR212 crores compared to INR210 crores in the same period last year.
- Return on Invested Capital (ROIC): 43% compared to 54% in the previous year period.
- Free Cash Flow: INR70 crores for the quarter.
- Engineering Business Revenue: INR1,212 crores compared to INR1,229 crores in the corresponding quarter.
- Engineering Business PBIT: INR156 crores compared to INR153 crores in the corresponding quarter.
- Metal Formed Business Revenue: INR400 crores compared to INR392 crores in the corresponding quarter last year.
- Metal Formed Business PBIT: INR40 crores compared to INR47 crores in the corresponding quarter.
- Bicycle Business Revenue: INR142 crores compared to INR147 crores in the corresponding quarter.
- Bicycle Business Loss: Negative INR0.82 crores compared to INR8 crores in the corresponding quarter.
- Others Revenue: INR252 crores compared to INR219 crores in the corresponding quarter.
- Others PBIT: INR11 crores compared to INR14 crores in the corresponding quarter.
- Consolidated Revenue: INR4,812 crores compared to INR4,197 crores in the corresponding quarter.
- Consolidated Profit: INR427 crores compared to INR395 crores in the corresponding quarter of the previous year.
- CG Power Revenue: INR2,516 crores compared to INR1,979 crores.
- CG Power Profit Before Exceptional Items and Tax: INR335 crores compared to INR264 crores.
- Shanti Gears Revenue: INR158 crores compared to INR126 crores in the corresponding quarter.
- Shanti Gears Profit Before Tax: INR35 crores compared to INR24 crores in the corresponding quarter of the previous year.
Release Date: February 04, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Tube Investments of India Ltd (NSE:TIINDIA, Financial) reported a consolidated revenue increase to INR4,812 crores from INR4,197 crores in the corresponding quarter of the previous year.
- The company's subsidiary, CG Power, showed significant growth with consolidated revenue rising to INR2,516 crores from INR1,979 crores.
- Shanti Gears, another subsidiary, also demonstrated strong performance with revenue increasing to INR158 crores from INR126 crores.
- The Engineering business maintained stable PBIT at INR156 crores, slightly up from INR153 crores in the corresponding quarter.
- The company is actively expanding its EV business, with plans to seed new products in the market by Q4 and full-fledged commercial sales starting in April 2025.
Negative Points
- The quarter was described as 'fairly flat' with minimal growth in revenue and profit before tax compared to the previous year.
- ROIC for the quarter decreased to 43% from 54% in the same period last year.
- The Metal Formed business experienced a decline in PBIT to INR40 crores from INR47 crores, attributed to pricing pressures and a drop in EV growth.
- The bicycle business continued to operate at a loss, albeit reduced to negative INR0.82 crores from INR8 crores in the previous year.
- The Clean Mobility business saw a decline in revenue from INR146 crores to INR127 crores, attributed to regional market dynamics and reduced incentives.
Q & A Highlights
Q: Are you present in the EV scooter market, and do any OEM customers plan to shift their EV scooters to chain drive?
A: Currently, it's in the development stage. One OEM is working on converting the belt into the chain, but it's still in the initial stages. The chain market will not become obsolete as motorcycle growth continues, and there's a significant aftermarket demand.
Q: Why did the Clean Mobility business see a decline in revenue despite increased volumes?
A: The 3-wheeler volumes were stable, but the TIV increased due to the festive season, which impacted regions where we have less presence. For trucks, we delivered fewer units in Q3 compared to Q2. These factors contributed to the revenue decline.
Q: What is causing the weak margin trajectory in the Metal Formed Product business?
A: The decline in railway pricing and a slowdown in EV growth due to model changes affected margins. However, we expect margins to stabilize around 10% to 11% at the PBT level.
Q: How is the Engineering division performing, and what impact do metal prices have?
A: The muted performance is primarily due to metal price corrections. However, we have seen a 7% to 8% growth in volume terms, and exports continue to contribute significantly.
Q: What is the strategy for the EV business over the next 3 to 5 years?
A: The focus is on improving market share and numbers while keeping an eye on margins. We aim to achieve operational breakeven in the next financial year for the two products already in the market.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
