Thread by @tycoonmindset05

Jubilant Ingrevia Ltd, conducted their conference call today at 5:00 pm.

"Keep adding value to our products and customers."

Here are the key takeaways 😁😁...

#jubilantingrevia

Business Report
- Despite covid related challenges, company has performed well In FY21.

- They were able to deliver uninterrupted service due to strong supply of raw material and logistics support.

- Company is able to maintain their margins with strong Operating leverage.

- Companies demerger from Life sciences whole business has improved their operating efficiency with good management structure.

- There has been a good demand in CDMO for pharma and agro side business.

- Company is looking for clients from all prespective And take what's better.

Segments
- Business is divided into 3 major parts
1. Speciality chemicals
- It witnessed an EBITDA growth of about 9%. Due to strong fine chemicals and new CDMO projects which were driven by demand from pharma, agro and nutrition customer's.

- Due to paraquat ban in Brazil and Thailand have reduced demand of pyridine leading to lower prices.

- In future, the price of pyridine and beta picoline will increase due to lower production and high demand.

- In this segment, market share was was improved with new products.

2. Nutrition and Health solutions
- It also witnessed a growth of about 9% which was strongly led by speciality products and choline chloride.

- Both 1 & 2 ebitda margins were impacted by the discontinuation of export benefits.

- Nutrition business was volatile due to demand of vitamin B3, and there was issue related to supply chain in terms of less availability of containers and ships due to higher freight cost.

- Animal business did got affected by pandemic and is expected to get better.

- 95% of vitamin B3 is from Exports, its global demand is growing a lot so capacity will be added in times to come.

- The product demand is stable here, and they are trying to pass on cost increases to customers.

3. Life sciences chemicals
- A segment which has given exponential growth to the company.

- The reported ebitda growth has been around 600% comparing Q4Fy21 with Q4FY20.

- This was due to favourable market on both domestic and export front.

- Any Cost increase were been passed on to customers with low impact on Margins.

- Their acetic anhydride And Ethyl Acetate market situation is very favourable on account of demand and lower availability in the market.

- Strong growth was also witnessed in speciality Ethanol. No capacity expansion is done there as of now.

- At present, 50% of sales comes from Life sciences chemicals, 18% from nutrition and 23% from speciality chemicals.

- About 65-70% of revenue are been generated from top 10 product's. In terms of large value products company is giving a thought about it.

- They are less focused on products which does provide value addition but on lower scale for the business.

Financials
- Company has maintained strong financial records for this period.

- On consolidated basis, PAT levels were double compared to Q4FY20.

- EBITDA grew by about 53% on YOY levels.

- Depends on products, but company tries to pass on its cost to customers.

- They were able to significantly reduce its debt by approx 600 crs and expect to reduce it further in upcoming years.

- In terms of Geographical revenue split For overall business, for Q4, about 62% revenue comes from India, 19% from Europe , 5% America and rest ROW.

- The volume and price in life sciences has increased a lot from existing business and new plant of fy20.

- It's difficult to say on QOQ levels but Company looks bullish on Yearly change.

- With good prices in hand, the trade receivable part has increased.

- Related to Taxes, Company has a mat credit of 160cr, Company will be continuing at 33% tax for next 1-2 years. But their cash tax will be lower.

-The above mentioned debt reduction will be in linked to Capex plans that the company is looking forward to.

Investments
- Keeping their growth plans intact, they have estimated to conduct Capex investment of about 300-350crs in FY22.

- Facility in Bharuch which was commenced in FY20 has worked very well for the company.

- Capacity debottlenecking was done to improve activity.

- The Capex will require about 12 to 15 months to generate revenue for business so planning will be done.

- The above Capex, is done to meet increased demand, in 1.5 to 2 years plant is expected to be running on capacity of 60 to 70%.

- In previous call, it was mentioned that about 1000cr of investment by FY24 is expected and for now they are on track.

- This Capex will majorly be from internal accrual.

- On Value added products, They are been made inhouse by the company.

- The Company is present in many different industries and is trying to increase their share Contribution in those segment in all manner possible.

- Capex is distributed in speciality chemicals, additional Anhydride plant which was informed in March and other small.

- Plants are currently working in a capacity range of about 85 -90% but continuous de bottlenecking and expansion are done.

- They have a subsidiary for business in agro active segment, as have value addition products in relation of it.

- They have a multi purpose plant for it

- Which caters both agro active and CDMO business as well.

- Separate subsidiary was been made to avail tax advantage and the company is expanded to incure about 150 to 200 cr expenditure for it in next 2 years.

- Plant is to be located in Bharuch in their SME zone.

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