Kajaria Ceramics, conducted their conference call today at 4:00 pm.
Here are the key takeaways π
Here are the key takeaways π
Business Updates:
β’ Achieved highest ever turnover in Q4, led by higher utilization, land efficiency and industry growth.
β’ Utilization- 98%
β’ Volume growth: 34%.
β’ Bath-ware segment growth: 72%
β’ April Sales was 75% of target, May company did 35% of target and in June 75%+.
β’ Achieved highest ever turnover in Q4, led by higher utilization, land efficiency and industry growth.
β’ Utilization- 98%
β’ Volume growth: 34%.
β’ Bath-ware segment growth: 72%
β’ April Sales was 75% of target, May company did 35% of target and in June 75%+.
Realization:
β’ Gas price has gone up 20-21% this year for Kajaria.
β’ Paper price has also gone up (for packing)
β’ Company has increased the price of ceramics by 2.5%.
β’ There is always lag of 45 days for transfer of increasing RM price to consumer.
β’ Gas price has gone up 20-21% this year for Kajaria.
β’ Paper price has also gone up (for packing)
β’ Company has increased the price of ceramics by 2.5%.
β’ There is always lag of 45 days for transfer of increasing RM price to consumer.
Bath-ware:
β’ Vision is to touch 500cr of sales in next 5 years.
β’ Existing plant has capacity to product more, hence not coming up with expansion in bath-ware.
β’ Prices have been increased by 10% in bath-ware as the prices of brass have gone up.
β’ Vision is to touch 500cr of sales in next 5 years.
β’ Existing plant has capacity to product more, hence not coming up with expansion in bath-ware.
β’ Prices have been increased by 10% in bath-ware as the prices of brass have gone up.
Faucet-ware:
β’ 10Lack pieces per annum was current capacity.
β’ 90-100% is capacity utilization.
β’ With little addition of machinery, capacity can go up to 30 Lac pieces, which is the plan for the company.
β’ 10Lack pieces per annum was current capacity.
β’ 90-100% is capacity utilization.
β’ With little addition of machinery, capacity can go up to 30 Lac pieces, which is the plan for the company.
Plyboard:
β’ 2021 turnover was 39cr. This year target is 82cr.
β’ Added laminates which is expected to drive higher growth.
β’ Kajaria is outsourcing laminates from Morbi. It is 6,000cr market and ~45% is unorganized hence there is huge growth.
conti.
β’ 2021 turnover was 39cr. This year target is 82cr.
β’ Added laminates which is expected to drive higher growth.
β’ Kajaria is outsourcing laminates from Morbi. It is 6,000cr market and ~45% is unorganized hence there is huge growth.
conti.
β’ While margins is expected to grow, and Kajaria expect to breakeven in this segment till FY23.
Sanitary-ware:
β’ Price has been hiked up by 6% in May month due to rise in price of gas, paper and increase in logistics cost.
Sanitary-ware:
β’ Price has been hiked up by 6% in May month due to rise in price of gas, paper and increase in logistics cost.
Home Improvement:
β’ Pent up demand has not gone anywhere, hence demand is increasing.
β’ While Work from Home has resulted an increasing demand for Home Improvement segment.
β’ Pent up demand has not gone anywhere, hence demand is increasing.
β’ While Work from Home has resulted an increasing demand for Home Improvement segment.
Product Mix:
β’ Current revenue contribution is around
- 40% from ceramics
- 32% PVT Tiles
- 28% GBT Tiles
β’ Adding expansion in South is on the value addition product which will increase the margins of the product.
β’ Current revenue contribution is around
- 40% from ceramics
- 32% PVT Tiles
- 28% GBT Tiles
β’ Adding expansion in South is on the value addition product which will increase the margins of the product.
Expansion:
β’ Gailpur: Adding 4.20 msm of floor tiles capacity with a spend of 60 cr. (Completed by March22)
β’ Srikalahasti: Adding a capacity of 3.80 msm with a spend of 110 cr. (Completed by Dec21)
β’ Jaxx: Adding 4.40 new capacity with spend of 80 cr (Completed by Jan22)
β’ Gailpur: Adding 4.20 msm of floor tiles capacity with a spend of 60 cr. (Completed by March22)
β’ Srikalahasti: Adding a capacity of 3.80 msm with a spend of 110 cr. (Completed by Dec21)
β’ Jaxx: Adding 4.40 new capacity with spend of 80 cr (Completed by Jan22)
Turnover Expectation:
Gailpur- 135-140cr
Jaxx- 175cr
Srikalahasti- 200cr
β’ Srikalahasti has extra expansion, as Kajaria is adding latest machinery here, which product larger tiles and has higher margin.
β’ All this expansion was delayed by 6 months and are brownfield expansion
Gailpur- 135-140cr
Jaxx- 175cr
Srikalahasti- 200cr
β’ Srikalahasti has extra expansion, as Kajaria is adding latest machinery here, which product larger tiles and has higher margin.
β’ All this expansion was delayed by 6 months and are brownfield expansion
Capacity vs Outsource:
β’ Kajaria expects to gain higher margin with respect to outsource hence co. has taken over expansion rather than outsource.
β’ Kajaria expects to gain higher margin with respect to outsource hence co. has taken over expansion rather than outsource.
Covid:
β’ First quarter of this year has impacted this quarter, however in June month, with recovery things are getting back to normal. July has turned to be normal market.
β’ First quarter of this year has impacted this quarter, however in June month, with recovery things are getting back to normal. July has turned to be normal market.
Dealer:
β’ Kajaria has 1700 dealer and 1500 operational dealer and Kajaria has vision to have dealer in every Lok-Sabha constituent.
In pandemic, Kajaria has added 200 distributors (normal dealer) and once things are normal, company will be stronger on exclusive dealer.
β’ Kajaria has 1700 dealer and 1500 operational dealer and Kajaria has vision to have dealer in every Lok-Sabha constituent.
In pandemic, Kajaria has added 200 distributors (normal dealer) and once things are normal, company will be stronger on exclusive dealer.
Export:
β’ Export is still continuing from Morbi. Except for lockdown period, export was still continue.
β’ China+ Policy and other countries adoption anti-dumping on China will be key driver for Kajaria.
β’ Export is still continuing from Morbi. Except for lockdown period, export was still continue.
β’ China+ Policy and other countries adoption anti-dumping on China will be key driver for Kajaria.
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