Management Interviews – Welspun India, Welspun Corp, Bajaj Electricals, Castrol India, Escorts, BEL

Welspun India

  • After a long time entered in to double digit growth trajectory
  • SPACES grown 20% in Q2
  • Launched W brand towels in domestic market
  • Christy sales via e commerce platform have gone up by 140%
  • Expecting 1800 crs revenue from Welspun flooring in 2-3 years time (2x of capex)
  • Double digit growth guidance for revenue and ebitda margin next year will improve substantially as current year hedges expire
  • Capex will be 900 crs – 700 crs for flooring. No new spending on spinning and weaving.

Link : https://youtu.be/mSHvcIzKTDk

 

Welspun Corp

  • 7% growth on YoY basis and 9% growth on QoQ basis
  • Ebitda is 239 crs at sales of 269 MT
  • Order book of 1.7 mn tonnes valued at 2 bn $ (highest ever in history of co.)
  • 850k tonnes from Saudi, 500k tonnes from US and 300k tonnes from India
  • Growth mostly coming from US mkt
  • Made a provision of 28 crs rs for ILFS and other bonds.

Link : https://youtu.be/zoF1df0buTE

 

Bajaj Electricals

  • Sales at 1598 crs vs 935 crs YoY , 71% growth
  • PAT gone up to 34 crs from 18 crs, 79.6% growth
  • Consumer product business growing by 25%
  • EPC is growing by 127% because of orders from UP projects
  • Consumer products margins are less as RM prices have gone up and Co. has not taken increase in prices, it will be taken in 3rd qtr
  • EPC margins – UP order margins are on lower side than other EPC projects
  • Total order book for EPC is 7300 crs
  • EPC topline by year end will be 4000 crs, 60% growth
  • Consumer products topline will be around 3000 crs
  • CP margins we expect to improve by 100 bps, EPC margins will be in same range

Link : https://youtu.be/G4yE78X8p_4

 

Castrol India

  • Current quarter volumes increased 4%
  • T/O increased 8% after putting in 3 prices increases in market
  • Profitability was maintained despite 115crs increase in cost of goods
  • ReLaunched some products with differentiated technology
  • We have recovered 80% of cost of goods increase in 9 months
  • No price hikes in this quarter unless huge change
  • Reached 150k retail outlets and signed alliance with M&M
  • Saw uptick in industrial volumes in Q3, 4% growth
  • Synthetic products is a small part of turnover % in India as market is still evolving
  • Lubricant demand depends on how much the vehicle moves and how many vehices are there in system and not so much on vehicles sales. Other thing that impacts is technology change. Replacement of lubricants are getting longer which means vehicles require lesser lubricants but they’ll require other synthetic products in which castrol is well positioned
  • Long term volume growth of 5-6%

Link : https://youtu.be/tuW3Dq-Nabw

 

Escorts

  • Diwali and Navratri are generally strong periods
  • Already taken price increase two times, will be looking again for 1% increase after festive season is over
  • In construction business, H1 is lower and H2 is better, guidance of 13% growth on full year basis
  • Railways – Order book – 400 crs+ which will be executed within next 12-13 months – Guidance of 25-30% growth on full year basis
  • Lowered margins in railways compared to previous quarters as we are entering new product segment. On a full year basis margins will be better by 200-300 bps
  • In tractors we are able to pass the cost increases to customers but in construction we are facing difficulties
  • Price realisations were better due to price hike taken
  • Overall macro for rural is looking positive for next 2-3 quarters

Link : https://youtu.be/eOr_jKPHk3I

 

BEL

  • Revenue growth of 20% for half year
  • PAT depends on mix of services provided during particular period
  • Ebitda guidance for full year around 17-18%
  • Order book of company at all time high touching 50,000 crs
  • Executable order per year will allow us to grow at 12% CAGR
  • Will complete deliveries at 11200 crs in this year
  • Expect order flow of 10000-13000 crs in FY 20

Link : https://youtu.be/xufvb85MJys

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