- 30 May 2022
- ICICIdirect Research
TTK Prestige reports improved revenue growth but input cost inflation dents marginsTTKPRESTIG - 699 Change: 28.20 (4.20 %)
News: TTK Prestige’s revenue for Q4FY22 grew by 17% YoY to Rs 648 crore. Gross margins declined 500 bps YoY (down 180 bps QoQ) to 40.6%. However, lower employee and other expenses (on account of operating leverage) led to EBITDA margin decline being restricted to 213 bps YoY to 16.3%. Absolute EBITDA grew by 3% YoY to Rs 106 crore. Consequently, PAT declined by 4% YoY to Rs 79 crore owing to Q4FY21 PAT being higher due to an exceptional income to the tune of Rs 11.9 crore.
Views: Revenue growth for the quarter was better than expectation owing to strong performance of the cooker and appliances segment which grew by 26% YoY and 15% YoY respectively. To mitigate the impact of raw material cost inflation the company has taken price hike in April 20222 which should enable it to shore up its margins going ahead. The Company continues to focus on maintaining healthy margins through improved efficiencies as well as calibrated price increases without any adverse effect on volumes and market share. TTK continues to innovate and added 28 new SKUs during Q4FY22 across all product categories and plans to add 33 new SKU’s in Q1FY23. The company is comfortably placed on the liquidity front and carries free cash of ~ Rs 700 crore which would enable it to tide over the current challenging business scenario.
Impact : Neutral