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Ratnamani Metals and Tubes Sales volume comes in below estimate; order book increases sequentially

News: For Q2FY22, Ratnamani Metals and Tubes (RMTL) reported topline of Rs.712 crore, up 23% YoY and 35% QoQ, marginally lower than our estimate of Rs.733 crore. EBITDA for Q2FY22 was at Rs.111 crore, up 35% YoY and 32% QoQ, lower than our estimate of Rs.128 crore. Ensuing PAT for Q2FY22 was at Rs.71 crore, up 26% YoY and 42% QoQ, lower than our estimate of Rs.90 crore.

Views: Ratnamani Metals and Tubes (RMTL) reported muted set of numbers for Q2FY22, wherein topline, EBITDA and PAT came in below our estimate. Performance during the quarter was impacted by lower than expected sales volume and higher raw material costs. For the quarter Ratnamani Metals and Tubes (RMTL), reported stainless steel sales volume of 4722 tonnes, up 30% QoQ but down 10% YoY, lower than our estimate of 5750 tonnes. Carbon steel sales volume for the quarter was at 53042 tonnes, up 9% QoQ but down 5% YoY, lower than our estimate of Rs.61250 tonnes. EBITDA margin for Q2FY22 was at 15.6%, up 119 bps YoY but down 44 bps QoQ, lower than our estimate of 17.5%. EBITDA margin came in lower than our estimate on the back of higher raw material cost. For the quarter, raw material costs as a % of sales stood at 65.6% as compared to 62.7% in Q1FY22 ( up 290 bps QoQ). However sequentially RMTL’s order book has increased from ~Rs.1535 crore on 1st August, 2021 to ~Rs.1741 crore on 1st October, 2021.