Time Technoplast posts Q1FY23 numbersTIMETECHNO - 177 Change: -2.75 (-1.53 %)
News: Time Technoplast reported revenue growth of ~25% YoY to ~Rs945 crore on a favourable base and strong demand of value added products. The value added segment revenue (revenue share of ~22%) increased 36% YoY to Rs 208 crore. The established product includes Drums, Pipes etc (revenue share of 78%) grew at ~23% YoY to Rs 737 crore. Despite gross margin fall of 200 bps YoY, savings in other expenses restricted overall EBITDA margin fall at 25 bps YoY to 13.1%. Finally, PAT at Rs 45 crore up ~54% YoY.
View: We believe the company’s Q1FY23 performance was largely driven by value added product segments. Value added product segment contribution to overall revenue has increased from 20% in pre-Covid level to 22% by the end of Q1FY23 led by strong demand of composite cylinders. However, the EBITDA margin at 13.1% is 100 bps lower than its’ pre-covid level margin dragged by higher raw material costs. The company is looking to raise fund by restructuring its overseas business and ramp up of composite cylinder capacity. We await management commentary on development from this front and new order inflows in the composite products category. We believe the company is likely to utilise the proceeds (received from restructuring) for the capex of its fast growing Composite Cylinders (LPG/CNG/Hydrogen) & core business in India.