Asian Granito plans major debt reduction

Asian Granito India Limited (AGIL), one of India's leading tiles brands is planning a major debt reduction and focusing on asset light and capital light business model. Company is reducing debt by around Rs. 40-45 in the near future and further reduction of Rs. 50-60 crore in next 1-2 years, thereby eyeing a total debt reduction of around Rs. 100 crore. Proceeds from warrants and internal accruals will be utilised to reduce the debt. Post conversion of the warrants, promoter group holding is expected to increase to around 37.5% from 34.02% as of December 2020.

Company is expecting to receive Rs. 41.85 crore from warrants issued to promoter and non promoter groups. Warrants are maturing on April 7, 2021, whereas the company expects to receive the same in the next few days. Entire proceeds of warrants will be used to repay debt. Company had issued 47 lakh warrants on preferential basis to promoter and non-promoter group in September 2019 at Rs. 180 per warrant to meet future expansion plans, debt reduction, meet working capital requirement and improve capital structure. Consolidated Debt of Asian Granito India Ltd as on 31 March 2020 was Rs. 308.9 crore.

Mr. Kamlesh Patel, Chairman and Managing Director, Asian Granito India Ltd said, "We hope to receive the outstanding amount towards the issued warrants and complete the due diligence before 31 March 2021. Post conversion of the warrants promoter holding will increase to around 37.5%. For the next phase of growth we are focusing on Asset light and Capital light business model, becoming a strong retail brand in the domestic as well as exports market and achieve leadership position in key business segments. Company is also expanding its business network in over 120 countries from 100 currently."

The company is doing a brownfield expansion with a new production line of SACMI - PCR 2000 Continua plus for slab at Crystal Ceramics, Mehsana. The latest technology based new line with capacity of 10,000 sq mtr per day glazed vitrified tiles is expected to start commercial operations by May 2021. Company will be manufacturing large format GVT 600X1200 mm for the export market. Additionally, the company is coming up with a new range of big format tiles 1600 X 3200 mm for Kitchen slabs in near future.

In a move to create living and business spaces safer, beautiful and hygienic than ever, the company has recently launched 'AGL Tuffguard Anti-Bacterial Tile (TAB).' In addition to be 99% free from bacteria and germs, AGL TAB tile are full of features like anti skid surfaces, stain and high abrasion resistant, scratch resistance, durable body, chemical & alkaline resistant which makes it ideal for high traffic areas of hospitals, schools, restaurant, hotels, gym, clubs, clinics, labs.

Asian Granito India Ltd offers widest range of products including, Ceramic Floor, Digital Wall, Vitrified, Parking, Porcelain, Glazed Vitrified, Outdoor, Engineered Marble & Quartz, etc. Further to leverage the synergies, the company has entered in bathware products that includes Faucets and Sanitaryware to provide 'Complete Bathroom Solutions' under brand AGL. Company has set a target to increase its touch points and expand the network of exclusive showrooms to 500. The company expects higher sales in coming quarters due to its dominance in B&C class cities and focused penetration in the market.

Shares of ASIAN GRANITO INDIA LTD. was last trading in BSE at Rs.153.8 as compared to the previous close of Rs. 164.15. The total number of shares traded during the day was 107723 in over 2230 trades.

The stock hit an intraday high of Rs. 171.8 and intraday low of 153.25. The net turnover during the day was Rs. 17304121.

Source : Equity Bulls

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