Hawkins Cookers Ltd Research ReportCo. Update

Owing to renewed customer interest in cooking appliances (as people preferred home cooked food) Hawkins reported healthy topline growth of 20% YoY to | 231 crore in Q3FY21. The company successfully launched a new range of pressure cookers and products like Tri-Ply stainless steel cookware. Further, Hawkins has enhanced its presence in online segment coupled with improved distribution and dealer reach. Gross margins for Q3FY21 declined 210 bps YoY to 56.8% owing to a change in channel mix and steady increase in raw material prices. We believe Hawkins has perked up its marketing spends during the quarter, which has led to other expenses increasing materially by 21% YoY to | 70 crore. Employee expenses increased 16% YoY to | 28.6 crore. Hence, EBITDA margins fell 216 bps YoY to 14.1%, with absolute EBITDA up 4% YoY to | 32.6 crore. Due to higher cash & bank balance, other income was at | 2.6 crore vs. | 0.9 crore in Q3FY20. Ensuing PAT grew 8% YoY to | 24.2 crore. Hawkins through its brand patronage (second largest player in pressure cooker segment) and healthy b/s is well placed to further consolidate its market positioning.