Surya Roshni Ltd share Price Today

Iron & Steel Products company Surya Roshni announced Q4FY24 & FY24 results:

Q4FY24 Financial Highlights:

• The company reported slight dip in revenue by 2% & EBITDA by 5% in FY24 on account of significant headwinds.
• EBITDA margins for Q4FY24 stood at 8.30%.
• Strong volume growth coupled with better product-mix in favor of higher margin value products and cost savings on back of PLI led backward integration resulted in strong operating profitability.
• EBITDA margins for Q4FY24 stood at 10.66% as against 9.84% for the same quarter last year.
• Professional lighting business has witnessed high-teen digit growth in Q4.
• Led Batten & LED Downlighter verticals saw healthy volume growth in FY24.
• In Q4FY24, the fan business recorded mid-teens growth, while the appliances segment grew by robust 20%.
• Net Working Capital: 76 days in Q4FY24 as against 70 days in Q3FY24.
• In Q4FY24, the steel pipes segment recorded its highest ever quarterly volumes of 2.36 lakh tons and witnessed a volume growth of 4%.
• Despite significant reduction in steel prices in Q4FY24, we witnessed only a slight dip in our overall sales revenue.
• EBITDA/Ton for the quarter stood at Rs 5,877.

FY24 Financial Highlights:

• We are now a Zero-debt company. We reduced our debt by Rs 400 crore in FY24 and have cash surplus of Rs 65 crore.
• Inspite of significant price erosion in consumer lighting business, we recorded an annual revenue growth of 2% and stands at Rs 1,572 crore in FY24.
• Professional lighting business witnessed more than 20% growth in FY24 driven by infrastructure as well as industrial projects.
• In FY24, the fan business recorded mid-teens growth, while the appliances segment grew by robust 20%.
• Net Working Capital: 55 days in Q4FY24 as against 69 days in Q3FY24.
• Growth of 6% in FY24 inspite of the B2B business witnessing a temporary slowdown on account of General Elections.
• Exports registered a volume growth of 12% in FY24.
• Strong in-hand order book of Rs 800 crore as on 31st March 2024 for Oil & Gas sector, Water Sector and Exports business.

Commenting on the results, Company’s Managing Director, Raju Bista, said “The overall performance of the company in FY24 has been satisfactory given the headwinds in both our business verticals of Steel Pipe business & Lighting and Consumer Durable business. We firmly believe that these headwinds are temporary, and the company is poised for sustained growth in both the businesses.

EBITDA for FY24 stood at Rs 586 crore as compared to Rs 620 crore last year. There was slight dip in our overall EBITDA margins primarily on account of significant dip in operating margin of steel pipes business which was slightly offset by improved margins in lighting and consumer durable business. We registered PAT of Rs 329 crore in FY24, similar to what we had recorded in FY23.”

“In Lighting and Consumer Durables, we experienced good results in FY24. Overall sales witnessed a growth of 2% and EBITDA increased by 23% in FY24 as compared to previous year, signaling improved operational efficiency and effective cost management.

Our professional lighting segment notably grew in Q4FY24 by approximately 20%, demonstrating strong market acceptance and a robust order book. Consumer durables, including fans, water heaters, irons, kitchen appliances, and festival lighting products, all posted double-digit growth, reflecting high consumer satisfaction and market penetration.

Throughout the year, our focus on design quality and manufacturing excellence has significantly reduced warranty related costs for LED products, placing us at the forefront of industry standards. Both lighting plants met productivity targets, benefiting from numerous automation and process improvement projects. This focus on operational efficiency not only enhanced our performance metrics but also supported our profitability, with EBITDA margins improving from 7.9% to 9.6% over the fiscal year.

Despite a challenging market environment with subdued demand for consumer durable products in the last quarter, our engagement strategies with over 25,000 key retailers and innovative marketing activations have kept our brand highly visible and competitive. The introduction of new product lines, particularly in the premium category, has successfully enriched our product mix, further bolstering our market standing.

Looking forward, we expect the lighting and consumer durables industry to continue experiencing growth, driven by increasing consumer aspirations and government spending on infrastructure. Our strong position in both B2C and B2B segments, along with our focus on high-quality, innovative products, positions us well to capitalize on these opportunities. Our ongoing investments in technology and product development, along with strategic market expansions, are expected to drive sustained growth and profitability in the upcoming fiscal years.”

“In the Steel Pipes and Strips, the company achieved the highest ever quarterly volumes despite challenging market conditions and electoral season. However, the company demonstrated resilience, managing only a slight dip in sales revenues due to decline in steel prices. This success is attributed to our strong presence in the API pipes segment and robust export performance, which collectively constituted 29% of our total volume sales. The downturn in steel prices led to an EBITDA/Ton of Rs5,877, on account of muted value-added product sales & loss in inventory.

The current Government’s 2024 manifesto has given a lot of impetus to infrastructure projects which includes overbridges, new airports and railway station redevelopment. The designs of these projects are such that it will generate robust demand for DFT pipes. The manifesto also includes a promise to expand city gas distribution (CGD) networks across India, which will drive growth. We also expect healthy volume growth in API pipes business as well. We also supply GI section pipes to solar utility projects, which are likely to witness rampant installation over the upcoming years.

We are actively expanding our operational capacity - aimed at increasing our monthly production capacity by 12,000 to 15,000 tons - to meet anticipated market demand. These expansions will enhance our ability to serve growing market needs, particularly in water infrastructure and energy sectors. With steel prices stabilizing and the government’s increased focus on infrastructure development, we expect healthy demand across our product lines.

Our strong order book of Rs800 crore, particularly in the oil & gas and water sectors, along with a solid export portfolio, underscores the company's robust financial health and operational efficiency. Improved working capital cycles and strategic raw material sourcing further strengthen our market position. We will continue to innovate, adapt, and grow, driven by a commitment to excellence and sustainability.”

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