Kirloskar pneumatic concall was today at 3:30
"Company is the main supplier of Gears to Indian railways "
Here are the concall details 😃
"Company is the main supplier of Gears to Indian railways "
Here are the concall details 😃
Overview
- Lot of broken supply chain issue. But the company had a very strong inflow in the second half.
- End of march as the pandemic came back, it has brought out dampening of supply again
- Compression segment had done very well
- Transmission segment has dropped
- Lot of broken supply chain issue. But the company had a very strong inflow in the second half.
- End of march as the pandemic came back, it has brought out dampening of supply again
- Compression segment had done very well
- Transmission segment has dropped
- Q4 was a strong quarter, there were order of 1k crores. The sales could be ramped up hence making the record sales.
- Export were only 3% of sales, however there are very strong enquiries are coming in.
- Company has capacity to meet the demand of fy22.
- Export were only 3% of sales, however there are very strong enquiries are coming in.
- Company has capacity to meet the demand of fy22.
- Significant receivable of 190 cr extra compared to last quarter.
- Free cash flow was 58% of PAT.
- Product sales CAGR was 4% in 5 years and project sales was 48%, which resulted in increasing material cost in last 5 years.
- Cost reduction are sustainable.
- Free cash flow was 58% of PAT.
- Product sales CAGR was 4% in 5 years and project sales was 48%, which resulted in increasing material cost in last 5 years.
- Cost reduction are sustainable.
Transmission business
- Transmission business sis dependent in Railway business
- This will also supply growth to gearbox business thus internally supplying to the company.
- In future this segment might shift to in-house supplier to centrifugal compressors
- Transmission business sis dependent in Railway business
- This will also supply growth to gearbox business thus internally supplying to the company.
- In future this segment might shift to in-house supplier to centrifugal compressors
Compression segment
- Rs. 782 cr. of sales. The compression segment is getting good demand.
- Major product development in high volume compressors (in house made)
- Delivered 24 large compressors for oxygen producers in india
- Air compressor market is 3k cr in india.
- Rs. 782 cr. of sales. The compression segment is getting good demand.
- Major product development in high volume compressors (in house made)
- Delivered 24 large compressors for oxygen producers in india
- Air compressor market is 3k cr in india.
- Domestic gas compression is around 1k crore plus in india
- Air compression sales 15-16%
- Gas compression sales 40-50%
- Refrigeration compression business sales 30%
- Trasmission business has shown a negative sales growth
- Air compression sales 15-16%
- Gas compression sales 40-50%
- Refrigeration compression business sales 30%
- Trasmission business has shown a negative sales growth
- Gas compression business can grow there are many CNG stations are coming in tier 2 cities.
- The whole gas compression package is given by company. There are only 2 players and the company has more than 50% share.
- Company has an edge in Gas compression business.
- The whole gas compression package is given by company. There are only 2 players and the company has more than 50% share.
- Company has an edge in Gas compression business.
- 50 to 70% of air compressor business is screw compressor business. Thus, the screw compressor business has huge potential market share to be taken.
Roadrailer business
- Small segment but has a huge potential.
- Can be a game changer in india in terms of long distance transport
- Roadrailers are mad ein the nasik plant. Approval from the railways and state transports had been given in 2015
- Small segment but has a huge potential.
- Can be a game changer in india in terms of long distance transport
- Roadrailers are mad ein the nasik plant. Approval from the railways and state transports had been given in 2015
- These coaches are been run right now on from Chennai to railway and back.
- First full year of operation had to be in FY 21. The concept has been received very well by customers.
- Customers are convinced of its efficacy and cost effectiveness.
- First full year of operation had to be in FY 21. The concept has been received very well by customers.
- Customers are convinced of its efficacy and cost effectiveness.
Market segment
- The market share is reasonably higher in air compression and refrigeration compression
- It is a tender driven business
- Compression segment consists of 90% of the business.
- Gas compression business consist of 50% out of compression business.
- The market share is reasonably higher in air compression and refrigeration compression
- It is a tender driven business
- Compression segment consists of 90% of the business.
- Gas compression business consist of 50% out of compression business.
Future outlook
- Strong order backlog of 900 crores would make next quarters better.
- There are chances of delivering double digit growth both top and bottom line
- Company has good cash balance to fund the future growth projects
- Margins will go towards northwards
- Strong order backlog of 900 crores would make next quarters better.
- There are chances of delivering double digit growth both top and bottom line
- Company has good cash balance to fund the future growth projects
- Margins will go towards northwards
For more discussion on Equity analysis
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