Strong Growth and Improved Margins Propel Everest Kanto Cylinder Ltd in Q3 FY24

Everest Kanto Cylinder Limited (EKC) (BSE: 532684, NSE: EKC), has released its consolidated financial results for the third quarter of the fiscal year 2023-24, showcasing significant growth and enhanced profitability.

Key Financial Highlights:

Income from Operations: Everest Kanto Cylinder Limited reported a substantial increase in income from operations, reaching ₹329.5 crores in Q3 FY24, compared to ₹256.4 crores in the same period last year. This represents a remarkable year-on-year growth of 28.5%. However, the cumulative income for the nine months of FY24 declined marginally to ₹897.1 crores, compared to ₹976.6 crores in the corresponding period last year, reflecting a decrease of 8.1%.

EBITDA: The company's EBITDA witnessed a significant surge, reaching ₹51.5 crores in Q3 FY24, compared to ₹14.5 crores in Q3 FY23. This represents an impressive year-on-year growth of 255.3%. The cumulative EBITDA for the nine months of FY24 stood at ₹129.7 crores, indicating a robust growth rate of 16.9% over the previous year.

EBITDA Margin: Everest Kanto Cylinder Limited achieved a substantial improvement in EBITDA margin, which stood at 15.6% in Q3 FY24, compared to 5.7% in Q3 FY23. This represents a significant increase of 998 basis points (bps) year-on-year. Similarly, the EBITDA margin for the nine months of FY24 improved to 14.5%, compared to 11.4% in the corresponding period last year, reflecting an increase of 310 bps.

Profit Before Tax (PBT): Everest Kanto Cylinder Limited reported a notable increase in profit before tax, reaching ₹43.2 crores in Q3 FY24, compared to ₹3.2 crores in Q3 FY23. This represents a remarkable year-on-year growth of 1,252.7%. The cumulative PBT for the nine months of FY24 stood at ₹101.6 crores, reflecting a robust growth rate of 30.4% over the previous year.

Profit After Tax (PAT): The company's PAT turned positive in Q3 FY24, reaching ₹36.5 crores, compared to a loss of ₹17.6 crores in the same period last year. This signifies a significant turnaround for Everest Kanto Cylinder Limited. The cumulative PAT for the nine months of FY24 stood at ₹84.5 crores, reflecting a substantial growth of 113.1% compared to the corresponding period last year.

Commenting on the performance for the quarter, in a joint statement, Mr. Pushkar Khurana, Chairman, and Mr. Puneet Khurana, Managing Director, said "We are pleased to report a healthy performance for the quarter. A steady increase in demand across both our domestic and international markets over the past few quarters has enabled us to improve our performance compared to the same quarter last year significantly. Notably, our key CNG segment sales have shown a YoY and QoQ increase, contributing significantly to our overall results in Q3.

In the landscape of India's energy evolution, the government's proactive steps to promote CNG as one of the essential fuels are commendable. A recent mandate for blending Compressed Biogas (CBG) with CNG marks a significant step within a broader strategy to increase the share of natural gas in the energy mix, aiming for environmental and economic benefits. The expansion of the City Gas Distribution (CGD) network and gas pipelines, which now aim to cover a majority of the population and geographical area, together with efforts to make CNG more affordable through revised pricing and financial incentives, highlights the government's dedication to a sustainable, cleaner energy future.

Moreover, the government's substantial investments to position India as a global frontrunner in green hydrogen by 2030 reflect a bold vision for the country's energy sector. With green hydrogen poised to play a pivotal role in India's sustainable energy framework, EKC's role in supplying hydrogen cylinders globally places us in a strong position within the expanding hydrogen market.

Looking forward, we are committed to reinforcing our market leadership, augmenting value for all our stakeholders, and making a meaningful contribution to the worldwide movement towards cleaner energy solutions. With adequate capacities and a strong balance sheet, EKC is well-positioned to capitalize on future growth opportunities, further enhancing our leadership in the industry."

Shares of Everest Kanto Cylinder Limited was last trading in BSE at Rs. 171.05 as compared to the previous close of Rs. 167.30. The total number of shares traded during the day was 582138 in over 9297 trades.

The stock hit an intraday high of Rs. 178.90 and intraday low of 164.15. The net turnover during the day was Rs. 100269077.00.

Source : Equity Bulls

Keywords

EverestKantoCylinder INE184H01027 EKC Q3FY24 9MFY24 ResultUpdate