(1/17)
About:
Kajaria Ceramics Limited was incorporated in 1985 as a manufacturer of floor & wall tiles by Mr. Ashok Kajaria in technical collaboration with Todagres SA, Spain.
It is the largest manufacturer of ceramic/vitrified tiles in India &
the 8th largest in the world.
About:
Kajaria Ceramics Limited was incorporated in 1985 as a manufacturer of floor & wall tiles by Mr. Ashok Kajaria in technical collaboration with Todagres SA, Spain.
It is the largest manufacturer of ceramic/vitrified tiles in India &
the 8th largest in the world.
(2/17)
Tile Industry:
India occupies the second position
in the global tile industry. While
the residential sector is the primary
consumer of tiles, demand from the commercial sector is growing
at a healthy clip owing to sustained
investments by the govt &
private players.
Tile Industry:
India occupies the second position
in the global tile industry. While
the residential sector is the primary
consumer of tiles, demand from the commercial sector is growing
at a healthy clip owing to sustained
investments by the govt &
private players.
(3/17)
Kajaria Product Verticals:
The company’s
manufacturing facilities are in Sikanderabad (UP), Gailpur & Malootana (Rajasthan) and Srikalahasti (Andhra
Pradesh), with an aggregate capacity of 62.2 msm. It also has 22.6 msm capacity under various subsidiaries/JVs.
Kajaria Product Verticals:
The company’s
manufacturing facilities are in Sikanderabad (UP), Gailpur & Malootana (Rajasthan) and Srikalahasti (Andhra
Pradesh), with an aggregate capacity of 62.2 msm. It also has 22.6 msm capacity under various subsidiaries/JVs.
(4/17)
Brands:
• Kajaria
• Kerovit
• Kajaria Ply
Brand Ambassadors:
• Akshay Kumar
• Ranveer Singh
• Anushka Sharma
Brands:
• Kajaria
• Kerovit
• Kajaria Ply
Brand Ambassadors:
• Akshay Kumar
• Ranveer Singh
• Anushka Sharma
(5/17)
Ind Growth Drivers:
• Sops for Home improvement :
The ceiling on loans for carrying out repairs, additions or alterations to their house had now been revised to ₹10 lakh in metropolitan centres & ₹6 lakh in other
centres. Up from ₹5lakh and ₹2lakh respectively
Ind Growth Drivers:
• Sops for Home improvement :
The ceiling on loans for carrying out repairs, additions or alterations to their house had now been revised to ₹10 lakh in metropolitan centres & ₹6 lakh in other
centres. Up from ₹5lakh and ₹2lakh respectively
(6/17)
Strong Underlying Demand:
As per the estimates of IMARC Group’s report, the Indian ceramic tiles market is expected to grow at a CAGR of 5-7% during the forecast period of 2022-2027.
The real estate demand is expected to increase by 15-18 million sq. ft. by
2025.
Strong Underlying Demand:
As per the estimates of IMARC Group’s report, the Indian ceramic tiles market is expected to grow at a CAGR of 5-7% during the forecast period of 2022-2027.
The real estate demand is expected to increase by 15-18 million sq. ft. by
2025.
(7/17)
Revenue classification by geography:
• North India (Biggest Market) : 40% share in revenue
• South India: (30-35)%
• West India: (25-30)%
• East India: 10%
Retail constitutes around 70-80% of the revenues for KCL.
Revenue classification by geography:
• North India (Biggest Market) : 40% share in revenue
• South India: (30-35)%
• West India: (25-30)%
• East India: 10%
Retail constitutes around 70-80% of the revenues for KCL.
(8/17)
Key Strengths:
• Pan-India presence -
KCL is the largest player in the
domestic tiles industry with a track record of over three decades. It has a pan-India distribution network of 1,700 dealers; 10,000 touchpoints.
Key Strengths:
• Pan-India presence -
KCL is the largest player in the
domestic tiles industry with a track record of over three decades. It has a pan-India distribution network of 1,700 dealers; 10,000 touchpoints.
(9/17)
• Scale of operations -
KCL has reported steady revenue growth over the years driven by A steady retail demand & increasing penetration in tier-II & tier-III markets, with revenues increasing to ₹3,705 crore in FY22 (+33% YoY) & ₹2,086 crore in H1 FY2023 (+36% YoY).
• Scale of operations -
KCL has reported steady revenue growth over the years driven by A steady retail demand & increasing penetration in tier-II & tier-III markets, with revenues increasing to ₹3,705 crore in FY22 (+33% YoY) & ₹2,086 crore in H1 FY2023 (+36% YoY).
(10/17)
Cash flow:
Company has largely stayed away from external debt for funding its capex requirements. This is due to the strong and consistent CF generation.
It has around ₹338cr of cash & liquid investments as on Sept 30, 2022, resulting in a net negative debt position.
Cash flow:
Company has largely stayed away from external debt for funding its capex requirements. This is due to the strong and consistent CF generation.
It has around ₹338cr of cash & liquid investments as on Sept 30, 2022, resulting in a net negative debt position.
(11/17)
Weaknesses:
Competition:
The growing presence of large, organised players and numerous mid & small sized players, along with high pace of capacity addition, in the recent past, has intensified competition in the tiles industry. We expect an uptick in marketing expenses
Weaknesses:
Competition:
The growing presence of large, organised players and numerous mid & small sized players, along with high pace of capacity addition, in the recent past, has intensified competition in the tiles industry. We expect an uptick in marketing expenses
(12/17)
• Susceptibility to RM & Fuel Prices:
Raw materials and natural gas form a major part of the cost structure for Kajaria. This is clearly reflected in the moderation of its profitability which is seeing a downtrend from 18.5% in FY21 to 16.5% in FY22 to 13.6% in H1FY23
• Susceptibility to RM & Fuel Prices:
Raw materials and natural gas form a major part of the cost structure for Kajaria. This is clearly reflected in the moderation of its profitability which is seeing a downtrend from 18.5% in FY21 to 16.5% in FY22 to 13.6% in H1FY23
(13/17)
However, we expect that the peak in prices are behind us and since Kajaria is the market leader in the sector. It commands a pricing power and thus is in a better position than it’s competitors.
We expect an improvement in profitability from here on.
However, we expect that the peak in prices are behind us and since Kajaria is the market leader in the sector. It commands a pricing power and thus is in a better position than it’s competitors.
We expect an improvement in profitability from here on.
(14/17)
Performance:
The quarter saw flattish volume growth but a decent revenue growth of 11% as compared to
Q2FY22 owing to increasing input cost.
Performance:
The quarter saw flattish volume growth but a decent revenue growth of 11% as compared to
Q2FY22 owing to increasing input cost.
(15/17)
Expansion Plans:
Source: Investor Presentation:
Expansion Plans:
Source: Investor Presentation:
(16/17)
Key Ratios and Numbers:
• Market Cap: ₹ 17,754 Cr
• Stock P/E: 46.5 vs Ind P/E: 32.54
• RoE: 14.9%
• PEG: 5.70
• Sales 3 year CAGR: 7.82%
• Price to Sales: 4.17
• NPM Last year: 10.4%
• OPM Q2FY23: 12%
• D/E: 0.10
• Dividend Yield: 0.98%
Key Ratios and Numbers:
• Market Cap: ₹ 17,754 Cr
• Stock P/E: 46.5 vs Ind P/E: 32.54
• RoE: 14.9%
• PEG: 5.70
• Sales 3 year CAGR: 7.82%
• Price to Sales: 4.17
• NPM Last year: 10.4%
• OPM Q2FY23: 12%
• D/E: 0.10
• Dividend Yield: 0.98%
(17/17)
Do you expect a strong & consistent volume growth for Tiles Industry in medium term?
@caniravkaria @kuttrapali26 @chartmojo
Do you expect a strong & consistent volume growth for Tiles Industry in medium term?
@caniravkaria @kuttrapali26 @chartmojo
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