News: Total operating income for Q4FY23 came in at Rs 2183 crore, up 17.3% YoY. EBITDA in Q4FY23 was at Rs 235.8 crore, up 23.9% QoQ with attendant EBITDA margins at 10.8%, up 240 bps QoQ. Consequent PAT in Q4FY23 was down 8.3% YoY at Rs 185.5 crore..
Views: The margin performance was higher than our estimates wherein gross margin expansion surprised positively and was up ~300 bps QoQ. The management said price settlement was done with its supplier in Q4FY23 leading to margin expansion. Further the management guided about commodity benefits to accrue further in Q1FY24 amid reduced cost of casting, pig iron, rubber, etc, which forms ~50-60% of overall cost. On the demand front the management expects domestic tractor industry to grow in single digits in FY24E, albeit on a high base.
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