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⚙️Birla Precision Technologies Ltd: Offering Machine Tool Accessories, Automotive Components & Castings.
⚙️Net Profit jumped by 174% QoQ
Detailed Company Analysis🧵👇

✍️About the company:
🔹Established in 1986, BPT Ltd is a leading Indian tool manufacturing company with an 80-year legacy. Formed as a joint venture between the Birla Group and Kennametal Inc., USA, it specializes in Machine Tool Accessories, Tools, Automotive Components & Castings.

🔹Co maintains an average market share of 50%, operates a network of 350+ dealers, exports to 30+ countries, and offers a product range with over 60,000 SKUs.

✍️Subsidiaries:
🔹Co has Five subsidiaries in the name and style of Birla Accucast Ltd, Birla Engineering Private Ltd, Birla Durotool Private Ltd.
🔹Additionally, it has two foreign subsidiaries: Birla Precision USA Limited and Birla Precision Technologies GmbH.

✍️Divisions & Product Profile:
🔹Tool Holder: Collet Holder, Side Lock Holders, Milling Holders, Collets, Shrink Fit Holder, Shrink-Fit Heating Machine, Hydraulic Chuck etc.
🔹Automotive & Industrial: BPTL Automotive & Industrial Division manufactures products like Turbocharger housings, Transmission Components, Disc Brake Parts, Hydraulic Pump Parts.

🔹Cutting Tools: Co offers HSS & Solid Carbide cutting tools like Twist Drills, End Mills, Reamers, Milling Cutters, Taps, and Tool Bits under the Dagger brand, along with Solid Carbide Drills & End Mills under the IT Carbomach brand.

🔹Durotool: Birla Durotool manufactures Power Tool Accessories, Abrasives, and hardware application accessories for various industries like carpentry, masonry, plumbing, agriculture, and stone cutting.

✍️Production Capacity:
🔹3 plants located in Aurangabad collectively possess an installed capacity of 14 lakh pieces per month.
🔹1 plant, based in Nasik, operates with an installed capacity of 4.87 lakh pieces per month.
🔹Situated in Chalisgaon, another plant boasts an installed capacity of 4 lakh pieces per month.

✍️Clientele:
🔹Company exports to the USA, Europe, and the Far East, including China.
🔹It is a primary vendor for Kennametal globally and serves clients like Cummins, Knorr-Bremse, Husco International, Honeywell, Bosch, BHEL, Ashok Leyland, Tata Motors, etc.

✍️Segment Wise Revenue FY23:
🔹Tooling: 84%
🔹Automotive Components: 16%
✍️Geographical Revenue Split FY23:
🔹USA: 4%
🔹Rest of the World: 9%
🔹India: 89%

✍️Key Metrics:
🔹M Cap: ₹402 Cr
🔹P/E: 34.6
🔹CMP: ₹61.6
🔹ROCE: 12.8%
🔹EVEBITDA: 13.5
🔹Debt to equity: 0.24
🔹3 Years Sales growth: 13.4%

✍️Q3FY24 Financials Highlights:
🔹Revenue at ₹67.29 Cr⬆️19% QOQ &⬆️14% YOY.
🔹OPM stands at 16.67%, compared to 9.75% YoY.
🔹PAT at ₹7.06 Cr⬆️174% QOQ & 73%YOY.
🔹TTM EPS at ₹1.77

✍️Key Highlights:
🔹Co achieved a robust turnover, with total revenue reaching ₹253 Cr compared to ₹246 Cr in the previous fiscal year.
🔹EBIDTA margin at 10.38% remained healthy in FY23.

🔹Co successfully acquired new customers while reinforcing its market share with existing ones.
🔹Company exports AT3 Class Tool Holders, collets and precision components to U.S.A, Europe and Asia Pacific countries.

🔹Co is expanding with a new project in Chalisgaon and expanding existing facilities in Nashik.
🔹Co currently produces 15.50 Lac units of Jobber Drills and Cutting Tools, with plans to increase by 4.50 Lac units by March 2024, investing ₹24 Cr for expansion.

✍️Industry Overview:
🔹India is becoming a global hub for auto component sourcing, with exports expected to reach US$30 bn by FY 2026.
🔹South Asia Pacific region will see rapid growth fueled by European and American manufacturers adopting the China plus one strategy.

🔹The cutting tools market closely mirrors overall industrial growth, with expansion in sectors like automotive, construction, and manufacturing driving increased demand for cutting tools.
🔹Expansion, geographical coverage, and marketing are vital strategies for boosting market share and outreach.

✍️Growth Drivers:
🔹Invest in Capex and machine automation for higher value addition and increased efficiency.
🔹Offer tailor-made solutions to meet individual customer needs while ensuring cost-effectiveness in manufacturing.

🔹Expand into global markets with a strategic footprint to access new opportunities and diversify risk.
🔹Lead the industry by embracing innovation and becoming a technological benchmark for others to follow.

✍️Key Challenges:
🔹Rapidly evolving global competition, with new players like Japan and emerging economies, poses challenges.
🔹Changes to accommodate new technological directions impact industry dynamics and relationships with users.

✍️Future Outlook:
🔹Development of new products, High Performance Carbide Cuttings Tools.
🔹Capacity improvement in drills by way of installing new machines, built in-house.

✍️Shareholding Pattern:
🔹Promoters: 59.84%
🔹FIIs: 0.01%
🔹Retailers: 40.12%
✍️Mission: To become a premier global supplier of precision CNC tooling and machined components, prioritizing customer satisfaction and industry excellence.

⚡️Disclaimer: The above data should not be considered as a Buy or Sell recommendation. The analysis has been done for educational and learning purpose only.

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