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