Pennar Industries Ltd Q1 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Nilesh Shah - Arrow Investments - Analyst : Congratulations on a good set of numbers. If you can just give some color on the projected guideline in terms of our top line and bottom line for the year, given that we are exiting out of these non-core businesses which are low value-added, and in terms of the Raebareli plant going live. If you can give us some color on the top line and the bottom line projected for the year.

Question: Nilesh Shah - Arrow Investments - Analyst : All right. So I'm just looking at the repeat from '23 to '24 in terms of our growth. So just to get an idea in terms of 10%, 15%, 20% kind of growth lines in terms of numbers that you can put in some perspective on that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 13, 2024 / 6:00AM, PENN.NS - Q1 2025 Pennar Industries Ltd Earnings Call

Question: Nilesh Shah - Arrow Investments - Analyst : Perfect. And my second question is on the land bank that we already have. I do -- I think we have our factories and projects over there. But given the kind of appreciation on the 500 acres plus, I think, if I'm not mistaken, you can correct me on the land bank, is there any plans of monetizing any of our land that we already own and which are not being used?

Question: Nilesh Shah - Arrow Investments - Analyst : Are we going to look at revaluing the assets and adding it up in our balance sheet to strengthen it up?

Question: Chirag Jain - Yogya Capital - Analyst : So first question is on the US PEB business. So what's the contribution of US business in the overall revenue?

Question: Chirag Jain - Yogya Capital - Analyst : Yes, fair enough. Sir, second question is on the -- we are talking about increasing the US PEB business. So what's the strategy for increasing our business? Would it be grab existing players' market share or gaining the exponential market growth over there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 13, 2024 / 6:00AM, PENN.NS - Q1 2025 Pennar Industries Ltd Earnings Call

Question: Chirag Jain - Yogya Capital - Analyst : Yes.

Question: Chirag Jain - Yogya Capital - Analyst : Okay. Fair enough. Sir, previously, in Q4 FY24, you mentioned about -- mentioning that you will be doing some CapEx for FY25 and it will be provided in Q1. So any update on that?

Question: Chirag Jain - Yogya Capital - Analyst : So do we have any ballpark number in mind currently?

Question: Deepak Poddar - Sapphire Capital - Analyst : Sir, just one thing I wanted to check. I mean in terms of this 35% of your revenue is in low-margin business. So can you just give some details on the differential between your low-margin business and high-margin business. So what sort of margin we have on this 65% pie in terms of EBITDA or PBT margin? And what sort of margin we have on this 35% pie? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 13, 2024 / 6:00AM, PENN.NS - Q1 2025 Pennar Industries Ltd Earnings Call

Question: Deepak Poddar - Sapphire Capital - Analyst : Understood. So -- and in how many quarters we are looking to completely exit the 35% pie?

Question: Deepak Poddar - Sapphire Capital - Analyst : Zero. So maybe what, one, two years would be a rough range. I mean I just wanted to understand the --

Question: Deepak Poddar - Sapphire Capital - Analyst : So when we completely exit then automatically our PBT margin, I mean, as per current level would come to around 6%, 6.5% rate, I mean. And there might be some improvement in that new business also, I mean, new business, I mean, high-margin business for the margin improvement scope that you mentioned above?

Question: Ashish Golechha - Growth Sphere Ventures LLP - Analyst : Sir, in last con call, you had basically given aspirations to become a billion dollar company. So my first question is, where are we on that? And second question was with respect to CapEx, my earlier participant had asked the question, we wanted to confirm what is the peak revenue expected through the CapEx, which takes place in the next two to three years? If you could throw some light on that, it would be really great. And congratulations for a very good set of numbers.

Question: Ankur Kumar - Alpha Capital - Analyst : Sir, I wanted to ask in the last con call, we said there would be a Q-o-Q growth in PBT, which unfortunately has not happened this quarter. Would you call that due to labor issues and capacity commissioning? Or how should we look at that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 13, 2024 / 6:00AM, PENN.NS - Q1 2025 Pennar Industries Ltd Earnings Call

Question: Ankur Kumar - Alpha Capital - Analyst : Got it. And sir, in this WIP, when will that going to commission? And when will the benefit starts accruing to us, Sir?

Question: Ankur Kumar - Alpha Capital - Analyst : The work in progress -- capital work in progress, how that capacity will be going to come for us?

Question: Ankur Kumar - Alpha Capital - Analyst : So we can expect benefit in the second half?

Question: Sai Ganesh - 64squares - Analyst : I just want to get the idea about, what was the contribution of our total percentage of sales from the low-margin business of FY23 and FY24?

Question: Sai Ganesh - 64squares - Analyst : Contribution of low-margin business of -- for the year of FY24 and FY23.