Release Date: April 23, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Pitti Engineering Ltd (BOM:513519, Financial) reported a consolidated revenue growth of 34.87% to INR1,743.36 crores for FY25.
- The company's consolidated EBITDA increased by 49.77% to INR271.12 crores, indicating strong operational performance.
- Sales volumes for lamination grew by 49.43% to 63,215 metric tons, showcasing robust demand.
- The company completed major CapEx cycles, including new capacity at the Aurangabad plant, enhancing production capabilities.
- Pitti Engineering Ltd (BOM:513519) is targeting a revenue growth of 15% for FY26, reflecting a positive business outlook.
Negative Points
- Consolidated PAT for Q4 declined by 21.43% to INR36.14 crores due to the absence of incentives booked in the previous year.
- There are ongoing geopolitical and international trade uncertainties that could impact future performance.
- The company faces cost pressures due to rising raw material prices, which could affect margins.
- The electrical steel supply constraints and safeguard duties on imports may lead to supply chain challenges.
- Despite strong revenue growth, the company anticipates only a modest increase in EBITDA margins over the next 12 to 18 months.
Q & A Highlights
Q: Can you provide sales and EBITDA numbers for Bakadia and Dakshin Foundries?
A: The sales volume for Bakadia is 14,075 tons, and for Dakshin, it is 3,224 tons. Revenue for Bagadia Chaitra was INR 240 crores and for Dakshin, INR 72 crores. EBITDA is not individually specified due to internal sales and consolidation; it should be viewed on a consolidated basis. - Akshay Pitti, Executive Vice Chairman of the Board, Managing Director
Q: What is the export revenue breakdown for FY25?
A: Approximately 30-35% of exports go to the USA, 55-60% to Mexico, and the remainder to other countries. - Akshay Pitti, Executive Vice Chairman of the Board, Managing Director
Q: How are raw material price increases affecting your margins?
A: We expect a 5% inflation due to raw material increases, but with a 10% volume growth in lamination and efficiency improvements, we anticipate maintaining a 16.5% to 17% EBITDA margin for the current fiscal year. - Akshay Pitti, Executive Vice Chairman of the Board, Managing Director
Q: What is the impact of electrical steel supply constraints?
A: Raw material prices have increased by about 7% since January. Supply constraints are expected due to BIS approvals expiring for Chinese imports and a 12.5% safeguard duty on inputs for Indian producers. We anticipate supply constraints to ease by mid-May. - Akshay Pitti, Executive Vice Chairman of the Board, Managing Director
Q: What are your plans for capacity expansion and CapEx?
A: We plan to add equipment rather than major CapEx cycles, with potential investments in H2 of the current year or H1 of FY27. The focus is on tactical additions to meet customer requirements, with a projected CapEx of around INR 50-60 crores for machining and INR 15-20 crores for lamination. - Akshay Pitti, Executive Vice Chairman of the Board, Managing Director
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
