Balkrishna Industries - Q1FY21 First Cut - ICICI Securities

(CMP: Rs. 1,385; MCap: Rs. 26,774 crore)

Balkrishna Industries (BIL) posted healthy Q1FY21 results under the circumstances, with topline decline limited to ~22% YoY and margins maintained at ~25%.

Q1FY21 Earnings Summary

- Standalone revenue for the quarter came in at Rs. 929 crore (down 22.2% YoY). Total tonnage declined 25.7% YoY to 38,096 MT during the Covid impacted period. Encouragingly, the company expects to close FY21E with similar volume levels as FY20 (~2 lakh MT) and informed that demand run rate has gained momentum thus far in Q2FY21, led by the agri side

- EBITDA in Q1FY21 stood at Rs. 230.6 crore, down 13.9% YoY and 38.1% QoQ. Margins declined by 262 bps sequentially to 24.8%. QoQ decline in margin performance was on account of negative operating leverage, although gross margins recorded strong 511 bps expansion

- Consequent PAT came in at Rs. 121.7 crore (down 30.8% YoY), impacted by fall in sales and other income as well as higher depreciation outgo

- The company declared an interim dividend of Rs. 3/share

We like BIL for its dominant market share in the niche OHT export segment, superior margin profile and cash rich, debt-free B/S. We will be coming out with a detailed report soon.

Shares of BALKRISHNA INDUSTRIES LTD. was last trading in BSE at Rs.1310.65 as compared to the previous close of Rs. 1384.9. The total number of shares traded during the day was 81336 in over 6363 trades.

The stock hit an intraday high of Rs. 1399.9 and intraday low of 1306.8. The net turnover during the day was Rs. 109832565.

Source : Equity Bulls

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