VST Tillers & Tractors posts muted Q1FY23 numbers

News: Net sales for the quarter came in at Rs 236 crore, up 22% YoY amidst power tiller sales volume of 9,161 units (up 36% YoY) and Tractor sales volume of 1,687 units (down 18% YoY). EBITDA for the quarter came in at Rs17 crore with corresponding EBITDA margins at 7.2%, down 660 bps QoQ (impacted by MTM loss  of ~ Rs 7 crore booked under other expenses head). PAT in Q1FY23 stood at Rs10 crore, down 58% YoY.

View: Gross margins were under tremendous pressure on the quarter and were down 420 bps on QoQ basis. Q1FY23 performance is a dampener post steady double digit margin trajectory clocked by the company since last few quarters. The ramp up in volumes especially on the tractor front is short of expectations.

Impact: Negative.