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#Mayuruniquoters Q1 23 Concall Highlights

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Operational and Financial Highlights
1. Mayur Uniquoters Ltd being a market leader in the synthetic leather industry and an organised player has been able to leverage the emerging opportunity

and deliver exemplary performance in the past year both in national and international markets.

2. The company has achieved revenue from operations on a standalone basis amounting to Rs 200.93 crores and PBT Rs 35.95 crores and PAT Rs 28.64 crores during the quarter which has

increased by 37%, 41% and 47% respectively from the last quarter.

3. Revenue from operations on a consolidated basis is Rs 200.44 crores and PBT is Rs 33.89 crores and PAT Rs 27.1 crores which has increased by 24%, 4% and 9% respectively from the last quarter.

4. The endeavor of the company is to make the company a preferred supplier for the leading OEM especially in the US and European region.

5. The company has already been approved by Mercedes Benz in South Africa, BMW in the European market and Volkswagen in India. Supply is

also started for Mercedes and Volkswagen for their new models. The product supply to BMW is expected from the March quarter this year.

6. The company has entered into the sale agreement with Backsen India for the product supply to Kia and Hyundai motors in India as well as the

global market. Supply has started in India in the last quarter.

7. The company has decided to put up a warp knitting plant for which necessary project activities are expected to start soon.

8. In the automotive sector the company has been selected for many incoming new models

in export as well as domestic auto OEMs for which supply will start in the year 2023-24 and 2024-25. So the company is expecting a very good performance in the coming years.

9. This year also the company is expecting a better performance than last year.

10. The company has also put up a foam lamination plant in the form of forward integration which is also doing well.

Q&A Highlights
1. The company has tried its best to pass on the raw material price increase to their clients as much as possible. The company has passed on

around 80-90% of the raw material price increase over time.

2. The company believes that there is a big scope in the automotive sector in export as well as in the domestic market. Domestic market is also increasing. There were some drawbacks for a few months such as

the chip shortage but now the situation is improving.

3. In export OEM, the company has already got approval of a few models from different companies in US, South Africa and Europe for which supply will start in the year 2023-24 and 2024-25. The company is expecting a

good sales increase during this period.

4. The company has also started retailing in the furnishing business. The furnishing market is huge and more than 48% of artificial leather is used in furnishing i.e., in sofas, office chairs etc. Currently the company has 25 dealers and

it has the plan to have at least 1000 dealers all over India in the next 1.5-2 years. So this will increase the margin and sales in the coming years.

5. The company is capable of making any type of artificial leather and also according to the requirement of the customer.

6. The company has a very strong R&D team. The company has roped in a European lady in the R&D team who is very knowledgeable in the automotive industry. Because of her the company has being able to get the business of Mercedes Benz, BMW etc

7. As of now the company’s capacity

utilization is 70%. The company has sufficient area to increase its capacity. The company can utilize 100% capacity in 1.5-2 years time.

8. The company needs to have a fair amount of capacity because if there is some demand requirement from the customer the company needs to

supply to the customer immediately. So the company always keeps spare capacity.

9. Succession planning: The company’s chairman, MD and CEO Suresh Kumar Poddar’s son in law is also working in Mayur Uniquoters as well as his son has also started attending the office.

He has started attending the office after a very long time. At Least 2-3 months he will observe every area and then will start working optimally. Having full control will take 1-1.5 years.

10. The company has many professional people from the industry who will also run the company going forward.

11. Mercedes and Volkswagen has insisted Mayur Uniquoters to put up a plant in the US.

12. In India, Mayur Uniquoters is the market leader in footwear and in automotive.

13. There are different sets of lines- printing line, embossing line etc There are different kinds of machines which are required to complete the whole thing.From machinery point of view the cost

of setting up one line is about Rs 30 crores. The company is gradually increasing the optimization of their machines as well as an optimization in manpower also.

14. In printing machines and embossing machines the company has got sufficient capacity. For expanding the capacity

Mayur has to put up a coating line. In greenfield expansion, the cost of setting up one coating line is Rs 100 crores.

15. For putting up a new coating line it usually takes about 9-10 months.

16. The company had a talk with one of the customers from Kolkata who is one of the

largest exporters of products made out of genuine leather. He is supplying to the top 3-4 big giants in the European market. The company has given him the PU material also. He has taken those samples to his customers and they have also approved.

17. The company also had a talk with some big footwear brands which are also interested in buying from India. People all over the world are shifting from Chinese products to Indian products.

18. The company is having a talk with a few suppliers for making PU chemical who have a joint venture in India. So the company has also started contacting big brands in the footwear industry.

19. Other expenses for the last three quarters used to be around Rs 24 to 25 crores

but in this quarter it is around Rs 35 crores. So this increase was in proportion to the sales volume as well as the transportation cost also increased around 30-40%.

20. The company has been able to maintain the price. The freight had increased 4 times at one point of time.

In the US Mayur used to sell at Rs 18 per meter which had become Rs 72 per meter at one point of time and now it has come back to Rs 35-36 per meter which is now gradually decreasing.

(Continued...)

21. When Mayur approaches a customer the customer won’t give orders for their existing models. They will give the orders only for their upcoming models.

22. Mayur is supplying 30,000 meters per month to Volkswagen India.

23. If Mayur gets 100000 or 150000 meters business in the US, then the company is ready to set up a plant in the US as well. Many companies in US prefer a local supplier i.e., the production line of the supplier should be in the US.

24. Normally big Auto OEM companies have

two suppliers.

25. Quarterly Revenue Split:
Export- Rs 50 crores. Out of this Rs 50 crores, export general is Rs 18 crores, Export OEM is Rs 32 crores
Domestic OEM is Rs 36 crores
Replacement is Rs 44 crores
Footwear is Rs 63 crores
Furnishing is Rs 6 crores

Others is Rs 1 crores

26. There was no inventory loss during this quarter.

27. PU sales during the quarter was Rs 7 crores.

28. The company has also entered into the footmat segment in the aftermarket business. This month Mayur has sold more than 30,000 meters in this segment.

Mainly Mayur was doing aftermarket business with Maruti. Now other companies have also started working in this segment.

29. The company is working seriously on High solid PU in the automotive industry.

30. The company expects the artificial leather market in the automotive

industry to increase in the coming years.

31. The management expects a 15% volume growth in the current financial year.

32.PVC resin prices are declining whereas the fabric prices are stable.

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