• Speed of filing products has been increased. Filed 5 new DMFs – 3 in US and 2 in EU
• Currently ramping up the facility in VIZAG with strong customer attraction, and will be commercialized as planned in Q3
• VIZAG EBIDTA growth guidance changed to 40%+ YoY
• Growth Driver: Broad based growth in other products and Vizag.
• PLI: Company has filed Mysore for PLI scheme for 1 molecule.
• Technology: Company is about to complete its 2 out of 3 technology, which will enhance efficiency for Solara.
Demand in some of sectors is moderated:
• Mgmt expected moderation in demand, hence company has taken necessary steps for those products.
Gross Margins:
• It was down a bit due to product mix however.
Fiscal 2022:
• Solara has grown in regulated market space.
• Vizag will kick in. CRAMS will support tailwind.
• Most of the CRAMS is commercial API.
• Most of the product is expected to be stable both in term of demand and price in the coming few quarter
Vizag:
• As the company is ramping up production facility, hence current utilization is around 1/3.
Price:
• Some market company is seeing pricing pressure, but where the major market of Solara is there is no strong pricing pressure.
Investment in Vizag:
• 3600 Tone in phase 1. Phase 2 will be multi-product. This will help mgmt in entering new market for Ibuprofen, as currently company has capacity constrain, which will be served by Vizag facility.
Q from @unseenvalue sir
Solara's Action post warning letters Cuddalore:
• As it was OAI, there won't be any production issues, and co. don't expects any regulatory issues.
• Company has now started with cloud reporting and all the products being registered to the US regulatory.
Gross margins:
• Company is well position in terms of customer, R&D, hence over long term it would be favorable, while in short term, margins are still in close eyes of management.
• Quite positive with strong with demand from the customer for molecule
New products:
• Large scale production, higher margins, better market share
Growth over next 3-5 year: Base molecules expected to deliver good growth, CRAMS (huge head room for space and New molecules is projected to deliver good growth over the next 4-5 years.
• Cash Flow will invested in the growth prospect only with little change over borrowing expected.
• Working Capital has remain same in the past few quarters with a little increase in sales. Receivable from the government is expected to be normalize.
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Shankara Building Products concall was today at 11:30 AM 😀
Here are the Key takeaways from the earning call 👇🧵
Business Updates:
• Q3 has seen uptick in the demand and co. is at its 80% of the pre-covid sales.
• There has been pick up in all the segment.
• Affordable Housing Segment has seen growth in the driver of business.
Segments
• Retail sector has seen 14% of the revenue growth. Revenue contribution 60%.
• Company has decreased the number of stores, as co. believes that they can work more efficiently with less number of stores.
• Avg ticket size of the company has been increased. (See image)