Astral Ltd - Q4FY21 First Cut - ICICI Direct

(CMP: Rs. 1800; MCap: Rs. 36163 crore)

In Q4FY21, Astral Ltd reported a better than expected performance on all fronts supported by a favourable base along with a strong business recovery in both piping & adhesive segments.

Q4FY21 Earnings Summary

- Consolidated net sales came in at ~Rs. 1129 crore, up ~79% YoY in Q4FY21 (vs. I-direct estimate: Rs. 855 crore) on a low base and a strong business recovery in the Adhesive and Piping segments. Piping segment revenue growth at 80% YoY to Rs. 886 crore in Q4FY21 supported by strong demand from urban regions. The adhesive segment revenue also grew by ~78% to ~Rs. 241 crore on a lower base and dealer additions

- The gross margin during the period was higher by 114 bps YoY(107 QoQ) supported by better product mix in the piping business and improved profitability in the Adhesive business. Additionally, savings in employee cost and other costs by ~242 bps and ~111 bps YoY respectively, led to ~467 bps increase in EBITDA margin on a YoY basis to 22.6% (Vs I-direct estimate: 19.7%)

- PAT came in at Rs. ~176 crore, increased by ~241% YoY (Vs I-direct estimate: Rs. 104 crore) mainly supported by strong revenue growth and notable expansion in EBITDA margin

For FY21, company reported strong topline growth of 23% YoY to Rs. 3176 crore led by 22% and 28% YoY growth in the piping and adhesive business respectively. While gross margin remains intact in FY21, the 300 bps YoY expansion in EBITDA margin to 20.3% was a result of higher operating leverage. We await management commentary on future margin guidance along with near term demand challenges given a lockdown situation across the country. The detailed report will be released post concall.

Shares of ASTRAL LTD. was last trading in BSE at Rs.1800 as compared to the previous close of Rs. 1765.1. The total number of shares traded during the day was 43088 in over 4794 trades.

The stock hit an intraday high of Rs. 1819.55 and intraday low of 1773.05. The net turnover during the day was Rs. 77363441.

Source : Equity Bulls

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