Sahyadri Industries , a prominent player in the asbestos-based roofing sector, has released its financial results for the first quarter, revealing a mixed performance amidst ongoing market challenges.

Financial Performance

The company reported a total income of Rs. 216.10 crores for Q1, marking a marginal decline of 0.80% year-over-year (YoY) but a significant increase of 41.60% quarter-on-quarter (QoQ). Despite the challenging market conditions, Sahyadri Industries managed to maintain its revenue stability compared to the same period last year.

The company's EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) stood at Rs. 21.70 crores, reflecting a 12.70% decrease YoY but a 56.70% increase QoQ. The EBITDA margin compressed to 10.10% from 11.40% in the previous year, indicating some pressure on profitability.

Profit after tax (PAT) experienced a 13.80% YoY decline to Rs. 10.80 crores. However, on a quarter-on-quarter basis, PAT showed a substantial improvement, rising by 152.20%.

Operational Highlights

Sahyadri Industries demonstrated operational resilience by improving its capacity utilization to 93% in Q1, up from 89% in the same quarter of the previous year. This improvement in utilization rates reflects the company's efforts to optimize its production capabilities despite market headwinds.

Market Challenges and Outlook

The company faced several challenges during the quarter, including:

1. Early onset of monsoon, particularly in May, which impacted sales.
2. Subdued demand in the roofing segment.
3. Elevated input costs, especially for imported asbestos fiber.
4. Supply chain disruptions and increased freight charges.
5. Depreciation of the Indian rupee, affecting import-related expenses.

Despite these challenges, Sahyadri Industries' management remains cautiously optimistic about the future. During the earnings conference call, CEO and CFO Tuljaram Maheshwari stated, "We anticipate that despite ongoing challenges, the future presents a path to recovery driven by good monsoon, stabilizing global supply chains, diversification of the sourcing base, improved price realization and sustained demand for asbestos-based roofing sheets, particularly in the rural housing and infrastructure projects."

Future Plans and Guidance

The company has outlined its plans for capacity expansion, with a Rs. 100 crore investment in a new facility in Palghar. This expansion is now targeted for completion in Q4 and is expected to add approximately Rs. 125 crores to the company's revenue once fully operational.

Looking ahead, Sahyadri Industries anticipates an 8-10% growth in topline, with expectations of improving margins. The management also expressed optimism about the potential of their non-asbestos business, particularly in fireproof and waterproof products, which they believe could see significant growth in the coming years.

As Sahyadri Industries navigates through these challenging times, the company's focus on operational efficiency, capacity expansion, and product diversification may play crucial roles in its future performance and market position.

Sahyadri Industries Limited , a pioneer in building solutions, has reported its financial results for the first quarter, showcasing resilience amid challenging market conditions.

Financial Performance

The company reported a total income of ₹216.10 crore for Q1, marking a slight decline of 0.80% year-over-year but a significant increase of 41.60% quarter-over-quarter. The earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at ₹21.70 crore, with a margin of 10.10%. While this represents a 12.70% decrease year-over-year, it shows a robust 56.70% growth compared to the previous quarter.

Profit after tax (PAT) for Q1 was reported at ₹10.80 crore, declining 13.80% year-over-year but surging by an impressive 152.20% quarter-over-quarter.

Operational Highlights

Sahyadri Industries demonstrated improved operational efficiency, with capacity utilization increasing to 93% in Q1, up from 89% in the same quarter of the previous year. This improvement in utilization rates indicates the company's ability to optimize its production capabilities despite market challenges.

Management Commentary

Mr. Satyen Patel, Managing Director of Sahyadri Industries Limited, commented on the results, stating, "The business has delivered a steady performance during the quarter. This performance was partly affected by weak demand and ongoing pricing pressures." He added that the growth outlook for the roofing sector remains positive, subject to geopolitical situations.

Expansion Plans

Sahyadri Industries is actively pursuing expansion strategies to strengthen its market position:

1. The company is setting up a new manufacturing unit in Orissa for asbestos corrugated sheets with a capacity of 120,000 MTPA.
2. Another unit is planned in Maharashtra for non-asbestos cement boards with a capacity of 72,000 MTPA.
3. Both projects require an investment of ₹95 crore each and will be funded through a combination of internal accruals and debt.

These expansion initiatives aim to cater to unrepresented markets in Eastern India (Orissa, Jharkhand, West Bengal, and Bihar) and to expand the company's presence in Western and Northern India, as well as boost export capabilities.

Market Outlook

Despite the challenges faced in Q1, Sahyadri Industries remains optimistic about the future. The company believes it is well-positioned to leverage the positive growth outlook in the roofing sector, supported by its improving capacity utilization and strong emphasis on sustainability.

As Sahyadri Industries continues to navigate through market pressures and expand its operations, investors and industry observers will be keenly watching the company's performance in the coming quarters.