- What led to a dent in #BorosilRenewables' profitability?
- How much did #GreavesCotton's exports impact their Q3 numbers?
Agam Vakil speaks to the companies' management on 'Earnings Edge'. #NDTVProfitLive
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- How much did #GreavesCotton's exports impact their Q3 numbers?
Agam Vakil speaks to the companies' management on 'Earnings Edge'. #NDTVProfitLive
______________________________________________________
For more videos subscribe to our channel: https://www.youtube.com/@NDTVProfitIndia
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02:03 - Hello and welcome.
02:07 You're watching Earnings Edge here on NDTV Profit.
02:10 And the first company that we are going to be talking to
02:13 is Borosil Renewables.
02:15 Well, it's been a couple of challenging quarters,
02:17 largely because of dumping.
02:19 And we're gonna talk about that,
02:21 the implications on the company,
02:23 as well as what we can expect going forward.
02:25 And for that, we have with us Mr. Pradeep Kumar Kheruka.
02:29 He's the Chairman of Borosil Renewables.
02:31 Mr. Kheruka, good afternoon, thanks for joining in.
02:34 We know that the company has had, you know,
02:37 to go through the implications of dumping,
02:41 because of which we've had a severe erosion in your EBITDA,
02:45 and thereby leading to a bottom line loss coming through.
02:49 Can you tell us about whether or not there is light
02:51 at the end of the tunnel and when?
02:53 Can we in fact expect the company to go back into the black,
02:57 considering the current conditions?
02:59 I believe that there are two aspects to it,
03:01 besides the lower prices.
03:04 We are also looking at increased interest costs as well.
03:08 Can you take us through some of these challenges
03:10 at the moment?
03:11 - Sure, thank you.
03:14 So the fact is that the exemptions
03:19 from payment of import duty on solar glass
03:23 were to have come to an end
03:26 on the 31st of March, 2023.
03:29 The government in its wisdom decided to extend it
03:32 by a year, last year,
03:34 and these were now set to come to an end
03:37 on the 31st of March, 2024.
03:40 For the whole year,
03:42 we have been petitioning the government,
03:43 showing them that there is a lot of dumping going on,
03:46 that the prices of solar glass being imported from China
03:51 have suffered a steep decline,
03:53 while the prices of inputs,
03:55 the commodities that are used to manufacture the glass
03:58 have actually registered a sharp rise.
04:01 So this is paradoxical,
04:03 where the cost of inputs is rising
04:05 and the price of sales is declining.
04:09 It's clearly a predatory move
04:11 designed to eliminate competition.
04:15 Fundamentally, solar glass has been eliminated,
04:17 production has been eliminated
04:19 from nearly everywhere in the world,
04:21 except for a company in Germany
04:23 and our company in India.
04:26 So the fact is that India has been showing
04:30 a lot of interest in the production of solar glass,
04:33 so much so that now five new manufacturers
04:36 have entered into the field of production,
04:38 and of whom four are already in production besides us.
04:42 That means there are five manufacturers
04:44 comprising the solar glass industry today.
04:46 Now, the thing is that I think the Chinese decided
04:52 that they need to deal with this with a strong hand
04:55 and they have reduced prices far below cost
05:00 to try to squeeze us out of the business.
05:02 Under these circumstances,
05:04 it is extremely, we were bewildered,
05:07 frankly speaking, and disappointed
05:09 to see that the government chose to further extend
05:12 the exemption from payment of any kind of duty
05:16 on imports of solar glass all the way till 30th September.
05:19 Now, this flies in the face of government's own reasoning,
05:24 their own policy, because they have imposed
05:28 a 25% basic customs duty on imports of all solar cells,
05:33 and they've imposed a 40% import duty
05:36 on the imports of solar modules.
05:39 So under these circumstances,
05:41 to have decided to exempt imports of solar glass
05:45 makes no logic to me and to other members in the industry.
05:50 So we trust, we hope that the government
05:54 is not going to extend this exemption
05:56 beyond the 30th of September.
05:59 - Okay, right.
06:01 No, sir, please go on.
06:03 Sir, I'm sure a lot of investors would want clarity
06:07 beyond that.
06:09 So if you could take us through
06:10 what we can expect going forward,
06:12 because should the current circumstances prevail,
06:16 would it mean that the company will face
06:19 a challenging time going ahead?
06:21 - Well, everything is dependent.
06:26 You know, we live in a very dynamic world, frankly speaking,
06:29 and there's nothing which is cast in stone.
06:32 So while we have been suffering
06:35 from the weight of this predatory pricing,
06:38 it has also driven us to explore ways
06:43 and means of enhancing our production
06:46 and trying to squeeze out more productivity
06:49 from the existing production setup.
06:51 After all, we've been in the glass business for 60 years,
06:54 and we have a little bit of experience in glassmaking,
06:58 I would say.
06:59 The other thing that we have done
07:02 is that the field is open for imposition
07:05 of anti-dumping duty.
07:07 We have already made an application
07:09 for imposition of anti-dumping duty
07:10 on imports of glass from China,
07:13 and a second one for imports on glass
07:15 from Vietnam and Malaysia.
07:17 So this is already with the Director General
07:20 of Trade Remedies,
07:21 and in some time, in due course,
07:23 this is going to come up for consideration and action
07:28 if deemed necessary by the government.
07:30 While we are all already pursuing this issue
07:33 of the 45, you know, of the anti-dump basic customs duty.
07:38 Now, what we are also doing is that we are making efforts
07:47 to see what we can do to reduce cost of production
07:54 and improve productivity.
07:56 Have I lost you by any chance?
07:57 - Very much with us, sir.
08:00 - Oh, okay, very good.
08:01 - Yeah.
08:02 Yeah, so we are making efforts to do that.
08:07 There is a possibility that we might improve
08:11 our showing a little bit.
08:13 We might say that we've hit rock bottom already.
08:16 So if anything, we should be going up a little bit
08:20 in terms of our costing and so on.
08:22 And we are very aggressive in our approach
08:27 to doing business.
08:28 I hope that we should be able to prevail
08:31 upon these circumstances.
08:33 - Sure, sure.
08:34 So if you could also now talk to us about FY25,
08:37 because two of your European acquisitions
08:39 will fully come on stream and we will have a full year
08:43 then with them as a part of contributing to the company.
08:46 So what kind of expectations do we have on the top line?
08:49 And once again, I do understand your top line
08:52 to a certain extent will also be determined
08:54 by the very, very volatile pricing environment that we have.
08:58 But perhaps if you could give us an idea
09:00 about the kind of contribution that these new
09:03 European acquisitions can make to the company.
09:06 - So our European acquisition took place in October 22.
09:10 We've had a bumpy ride there because in the year 22,
09:14 the continent of Europe was still struggling
09:18 with the prices of,
09:21 with exorbitant prices of natural gas and electricity,
09:25 which had been already hedged by the previous management.
09:29 So we did not suffer that badly from it.
09:32 Having said all that, we undertook a furnace repair
09:36 in April, in April, 2023,
09:41 after which we are now back in full production,
09:44 350 tons a day.
09:46 And we have got a top rated manufacturing team
09:49 with us there.
09:50 The product is highly regarded in European markets
09:54 by our customers there.
09:56 So we are set for everything there, frankly speaking.
09:58 Except one thing, that the same predatory pricing,
10:03 which is impacting the Indian market,
10:05 is also impacting Europe.
10:06 And so therefore, the manufacturers of solar glass,
10:11 the manufacturer of solar modules in Europe
10:14 have suffered greatly.
10:16 And they have reduced their production significantly.
10:20 They have also been petitioning the European Union
10:23 and their respective governments for strong support
10:26 against the Chinese activities.
10:29 So we hope that something is going to come out of that.
10:32 The matter is currently in discussion with the Bundestag,
10:37 which is the German parliament.
10:39 I've had meetings with the minister president
10:42 of the state of Brandenburg and the minister energy as well.
10:46 And they have urged us to hang on.
10:48 And they have said that they're going to do their best
10:52 to make sure that a suitable package is developed over there.
10:57 So we are battling there, but we are not without hope.
11:02 Let's put it that way.
11:03 - So again, please correct me if I'm wrong.
11:05 In the second quarter, you had stalled
11:08 some of your capacity expansion plans at the moment.
11:12 Is that the case?
11:13 One.
11:14 Secondly, is that because of your current
11:16 prevailing environment?
11:18 And if that is so,
11:20 when do you expect to resume that expansion?
11:22 - So I wonder if you're thinking
11:25 or discussing the 1000 tons per day.
11:28 - Yes, sir.
11:29 That's the one.
11:29 - Yeah, that is certainly on hold at this time.
11:32 - Right.
11:33 - Because that would not make any sense
11:34 for us to pursue at this time.
11:36 - Sure.
11:37 - When we are still trying to stabilize on this one.
11:40 So we have all the land for that.
11:43 We have part of the capex for that has already been spent.
11:47 So we have a batch house,
11:48 which is capable of handling that second project
11:52 whenever it comes.
11:54 So the cost of that project would stand diminished
11:57 to that extent.
11:58 It would not need a separate batch house.
12:01 So we are well poised to expand
12:04 if we get requisite support from the government.
12:06 - Fair enough, fair enough, sir.
12:08 Mr. Kheruka, we leave it at that.
12:10 Thank you so much for, well,
12:11 spelling it out for us more clearly
12:13 as to what the current environment means.
12:15 Of course, sir, we will all be hoping
12:17 for an improvement, certainly the shareholders will
12:20 under the current circumstances.
12:21 Thank you so much for joining us
12:22 and taking us through the many factors there.
12:25 - Thank you.
12:26 - Okay.
12:27 - All right.
12:28 Well, that's the management of Borosil Renewables,
12:30 enumerating the various challenges.
12:32 And of course, all the costs of action
12:35 that the company is taking,
12:36 but a lot will depend on the environment
12:39 as well as the authorities at the moment,
12:41 where of course, dumping certainly plays
12:44 a little bit of a havoc when it comes to the profitability
12:47 of the particular company.
12:48 We'll continue to give you updates on that one.
12:50 But on that note, it's time to slip into a short break,
12:53 but do stay tuned.
12:54 We have lots more on the other side.
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16:56 - Welcome back, this is "Earnings Edge"
17:00 and now we take stock of Grease Cotton.
17:03 It's been a relatively strong quarter
17:06 for this particular company.
17:07 Of course, a lot of that is to do with engines
17:10 and e-mobility as well.
17:12 Well, we are in conversation with Akhila Balachander.
17:15 He's a CFO of the company.
17:18 Akhila, good afternoon, thanks for joining in.
17:21 The question for you-
17:24 - Good afternoon, Adam,
17:24 and thanks for inviting me over on the show.
17:28 - Most welcome, most welcome, Akhila.
17:30 My question to you is that it's certainly been
17:31 a good quarter and of a good, very strong,
17:35 you know, first nine months of this financial year as well.
17:38 My question is, do you expect this momentum to sustain
17:42 going into not just the fourth quarter, but also FY25?
17:47 And well, what are the contributing factors here
17:51 as far as your performance is concerned?
17:53 - Sure, so as you rightly said,
17:57 it's been an extremely satisfying quarter for us
18:01 and also an extremely strong and satisfying
18:04 first nine months of the year.
18:07 So let me step back before we go forward.
18:11 A couple of years back,
18:13 we embarked on a transformation journey
18:16 and Greaves from being a single product, single fuel,
18:21 single customer company has now diversified
18:26 into three core verticals, engines,
18:29 retails, and electric mobility.
18:32 Within each of these verticals,
18:34 we have embarked on different initiatives
18:37 covering product diversification, product enrichment,
18:44 application diversification, geographical enrichment, right?
18:50 So multiple initiatives, a number of these
18:54 are now beginning to play out.
18:57 And I think this is a journey and therefore
19:00 we should hopefully continue in the same trajectory.
19:04 - Sure, well, so if you could actually,
19:06 take us through the engines bit,
19:08 because I reckon that this is perhaps
19:11 your largest of the segments at the moment
19:13 in terms of contribution to revenues.
19:15 What kind of trends are you seeing here
19:17 and what is it that's driving growth
19:20 in this particular segment?
19:21 - Sure, so engines has one of our core businesses,
19:26 as you rightly pointed out, and still contributes heavily
19:30 to both the top line and also the bottom line.
19:34 If you take the initiatives,
19:36 we've been working on improving our product portfolio.
19:40 So we used to be present only in diesel engines.
19:43 Now we are moving towards more fuel agnostic engines.
19:47 It try to diversify across applications,
19:52 mobility and non-mobility.
19:54 Third thing we are doing is doing a geographical expansion,
19:59 not just in India, but also overseas.
20:02 If you remember in May of this year,
20:05 we invested in a company called Excel Control Linkage,
20:09 which is a wonderful adjacencies to our business
20:13 and kinds of dovetails to a lot of things
20:15 that we want to do.
20:16 They are essentially into push-pull cables,
20:19 levers, sensors, and these are things
20:22 which will again go back and help us to strengthen
20:25 our product diversification strategy.
20:27 - A question on e-mobility as well.
20:31 And I do see that it also contributes
20:35 to nearly a fifth of your revenues.
20:37 I want to try and perhaps understand the scope
20:40 of this particular business.
20:41 At what stage is India and the other markets
20:44 that you do cater to when it comes to adaption
20:47 of e-mobility and well, going forward,
20:51 what kind of investments can we expect the company
20:53 to put into this particular segment?
20:56 - Sure, thanks, Agam.
20:59 The world is transitioning to a green fuel
21:02 kind of an environment,
21:04 whether it is batteries, electric mobility, hydrogen.
21:10 So this is something that is definitely the future.
21:15 In terms of adoption,
21:17 each one is in a different state of adoption
21:20 and a stage of adoption, but it's a journey.
21:22 And ultimately, I think more and more,
21:25 the adoption is going to increase over a period of time.
21:29 What we are doing is we are preparing ourselves
21:33 and we're very focused in doing product development
21:36 around this.
21:37 We have a host of product today on the both
21:41 E two-wheeler segment and E three-wheeler segment,
21:44 and we are continuously improving our product portfolio.
21:47 We're currently in the process of adding new products
21:53 in the two-wheeler, E two-wheeler business.
21:55 And we are currently live on social media.
21:58 We planned the next big thing,
22:01 social media launch that has happened
22:04 where we are doing a journey from Kashmir to Kanyakumari.
22:07 So you can expect some really strong product launches
22:10 from us going forward.
22:12 And this will only help fortify the business
22:15 and product offerings.
22:17 - I do notice that at least as on last year,
22:21 you guys had nearly no debt,
22:23 and you guys have substantial amount of net cash positivity.
22:28 My question then is that in terms of expansion,
22:31 what are the plans at the end?
22:33 And under those circumstances,
22:35 have you already perhaps increased debt
22:39 or are we looking to perhaps raise more funds through debt
22:43 or will any sort of expansion be funded
22:47 through internal accruals?
22:50 - Thanks for this question.
22:52 I really appreciate.
22:54 Look, we are currently practically zero debt
22:58 and we have a strong cash built out in our books.
23:03 This really helps us to kind of look at acquisitions.
23:07 We did one acquisition, which I mentioned,
23:10 the Excel control linkage,
23:12 which is really adding the entire product proposition.
23:16 We would similarly be looking at very interesting opportunities
23:21 as in when they come to us.
23:23 In terms of debt, as you rightly said yourself,
23:28 we currently have no debt on our books.
23:31 And if required, the management and the board
23:35 will take an appropriate call.
23:36 And definitely that is something one will not rule out.
23:40 But I think a good mixture of debt and equity
23:44 would be only to ensure also how we are able to improve
23:49 our overall return on capital employed.
23:52 - Sure.
23:53 And a final word on the outlook perhaps going into FY25.
23:57 And I understand you can't really give me a guidance
24:01 if you don't need me to, I don't need to,
24:04 but we have seen the first nine months seeing a good 25%
24:09 in your volumes growth for engines.
24:11 But electric mobility volumes, however,
24:13 we've seen a little bit of taken a little bit of a backseat
24:16 and have we seen a decline.
24:18 My question really is in terms going into FY25,
24:22 what sort of a ballpark run rate range can you provide me with,
24:26 help me with, and what can we expect there?
24:30 - Agam, as you rightly said,
24:31 it was not possible for us to share guidance.
24:34 But as I said, and if you really see the trajectory
24:38 of the last two, two and a half, three years of this company
24:42 in terms of revenue, there has been a robust growth.
24:46 In fact, this quarter we've done a 30% year on year growth.
24:50 If you take margins,
24:52 we've done a fairly steady improvement in our performance
24:56 in terms of product portfolio.
24:58 And as I said, we've just launched a campaign
25:02 around the next big thing.
25:03 And we have a social media campaign where the product
25:06 is going on a drive from Kashmir to Kanyakumari.
25:10 So all this I think is what I would be able to share
25:14 and hopefully this is something that will play out
25:18 over the future.
25:19 - Sure, fair enough, Akhila.
25:20 We leave it at that.
25:21 Thank you so much for joining us
25:23 and taking us through the quarter gone by
25:25 as well as what to expect going forward.
25:26 - Thanks very much.
25:27 - Thank you.
25:28 Well, that's the management of Greaves Cotton
25:30 telling us about, well, potentially positive prospects
25:35 going into the next financial year as well.
25:37 And from there on, we move on to Wanderla Holidays
25:40 where the net profit, well, sunk by as much as 4%
25:43 in the third quarter.
25:45 And this is where my colleague Pallavi spoke
25:47 to Arun Chittilapilli about the reason behind this decline.
25:52 This is a slice of that conversation.
25:54 - Yeah, so our operating profits are slightly lower
25:58 this quarter compared to a previous corresponding quarter,
26:02 mainly because we've had a lot of management bandwidth
26:07 into the system.
26:08 We have actually hired almost 60 extra headcount
26:11 into the company, keeping in mind that we are looking
26:14 at growth in new cities.
26:17 Some of them are top level executives
26:19 and some are park level executives in our new projects.
26:23 But that's one reason.
26:24 The other reason why we have slightly lower margins
26:28 is because our marketing and promotion spends
26:31 have gone up a little bit
26:32 because we had a lot of footfalls
26:36 in the last quarter from institutions
26:39 where we share margins with third party agents.
26:42 So these are the two reasons why we have
26:44 slightly lower margins.
26:46 - Okay, all right.
26:47 I do want to understand what's been happening
26:51 on the parks fronts.
26:52 Have we seen any openings in recent times?
26:56 And what's expected to drive growth in the next quarter?
26:59 - So next quarter, we are not opening any new parks.
27:04 It's gonna be the existing three parks
27:06 which are going to contribute.
27:07 But starting from Q1 in the next financial year,
27:12 newest park in Bubeneshwar will be on stream
27:15 sometime late May.
27:17 So that will add some revenues.
27:20 We are expecting roughly about five to six lakh visitors
27:24 in the first year.
27:26 Then our pool of between 800 to 1000 rupees.
27:29 So that's gonna be an additional revenue going forward
27:33 for the company.
27:36 And in FY26, we will have our fifth park in Chennai,
27:40 which will also open the second or third quarter.
27:44 - Okay, all right.
27:46 Could you guide us through
27:47 what is the land acquisition strategy?
27:50 Has that been completed for these parks that are coming up?
27:54 And how do you propose to go ahead with that?
27:58 - So land acquisition for our two new projects
28:03 have already been done, which is Chennai and Bubeneshwar.
28:06 But on top of this, we are also looking at land acquisition
28:10 in Madhya Pradesh, in Indore, Mohali, in Punjab,
28:15 and also in the Greater Noida region in Uttar Pradesh.
28:20 So these are the three other new projects
28:23 that we are looking at.
28:24 We hope to conclude land acquisition
28:26 in at least two of these new locations
28:29 within the next financial year.
28:31 And we'll make an announcement when it's done.
28:33 - That's Vandula Holidays,
28:35 telling us about a new park in Bubeneshwar
28:37 opening up in the first quarter of this upcoming financial year
28:41 and also giving us an idea
28:42 about the kind of revenues we can expect at least ahead.
28:45 But with that, we are completely out of the time on the show,
28:48 but don't go anywhere.
28:49 On the other side, we get you India markets close.
28:52 Stay tuned to NDTV Profit.
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