JK Tyres reports dismal performance for Q4FY22JKTYRE - 102 Change: -0.15 (-0.15 %)
News: Company reported dismal performance in Q4FY22 with consolidated sales for the quarter coming in at Rs. 3,312 crore, up 8% QoQ. EBITDA for the quarter came in at Rs. 228 crore with corresponding EBITDA margin at 6.9% (down 200 bps QoQ). Gross margin decline was massive 320 bps sequentially. PAT in Q4FY22 was at Rs. 40.2 crore, down 29% QoQ. Standalone EBITDA margins stood at 6.2% (down ~300 bps QoQ).
Views: Quarterly performance of the company lagged its listed peers. Management commentary on demand outlook was healthy however margins are seen further muted in coming quarter. On the B/s front the increase in debt was to the tune of ~Rs. 450 crore on YoY basis to ~Rs. 5,100 crore as of FY22, primarily due to increase in working capital requirement due to elevated commodity costs. However the company announced a fresh leg of capex amounting to ~Rs. 766 crore which would largely keep debt at elevated levels over next 2 years vs. the earlier commentary of calibrated capex spend to reduce leverage on B/S.