Stock Report

Modi Naturals Limited reports earnings for Q3 & 9MFY23

Posted On : 2023-02-16 18:12:20( TIMEZONE : IST )

Modi Naturals Limited reports earnings for Q3 & 9MFY23

9MFY23 Consolidated Performance Highlights:

- 9MFY23 revenue stood at Rs 307.5 cr
- EBITDA for 9MFY23 was Rs 7.4 cr
- PAT for 9MFY23 was Rs 3.4 cr

Profitability was affected due to stock inventory valuation loss of Rs 1.5cr owing to the sudden reduction in oil prices through Q3FY23

Interest costs have also increased due to construction of the plant in Chhattisgarh which is yet to start generating revenue

Recent Developments

Consumer Division

Oil Category

- The lifting of the stock limits has had a positive impact. Finally, large retailers and wholesalers have been exempted from these limits starting mid- November.

- We have seen the partial impact of this positive decision in Q3FY23, and full impact will be visible in Q4FY23 and Q1FY24

Food Business

- The Food business has grown 47% YTD and is still scaling up with distribution expansion every quarter

- Launched food products in Spencer's in Q3FY23, and it has had a positive response

- We are confident of maintaining this momentum going forward, along with new product launches slated for Q4FY23

- Extending our range of ready to cook pasta and adding new shapes i.e., macaroni and spaghetti.

With our commitment to innovation in the food category, we are launching a one of its kind multi-grain pasta with the goodness of 4 grains, in the premium category

- In Peanut Butter we are creating a vertical segmentation, wherein we are launching a product specifically targeted for children in the age bracket of 4-13 years

Oleev Junior Peanut Butter will be available in chocolate flavour as well and will be piloted in Q4FY23

- Under PIPO, we are extending the portfolio and getting into RTE space with our range of flavoured roasted peanuts. These RTE peanuts will be available in 5 flavours such as peri-peri, BBQ, heeng-jeera etc and will be piloted in Q4

PIPO's sub-brand Taste bomb is being separately launched in the instant masala/ seasoning category with six variants such as Magic masala, pasta masala, peri peri, Oregano, Italian herbs and Tandoori

- New category of powdered ready-to-mix beverages will be piloted in Q4 under new brand "Jynx" with the following flavours- mango, orange, ice tea-lemon and Mojito.This will help us enter an exciting new category which is doing well with Gen-Z and will also offset some of the seasonality in oil demand in summer months.

Ethanol Business

- Construction of the distillery is nearing completion.

- We expect to start trials at the plant in March and commercial production in April. Expenditure at the end of Q3 on the project is Rs 90.47 cr.

Commenting on the performance, Mr. Akshay Modi, Joint Managing Director, Modi Naturals, said, "The performance for Q3 & 9MFY23 has been relatively soft owing to several macro-economic factors impacting the level of operations, mainly attributable to the continued reduction of oil prices in our bulk oil business and the stock limits which were imposed by the government. However, the government has removed stock limits in November, and we should see the positive impact of this from Q4 onwards. We are positive about a stronger Q4FY23.

Additionally, demand seems to be recovering, with relaxations given to large retailers and wholesalers. It is a positive sign as we go forward. Construction of our distillery is on track and is expected to start trials in March and contribute financially from Q1FY24.

On the food business, we continue extend our offerings and stick to our commitment towards food innovation, which will yield results and create a robust product portfolio strengthening our brand. We have recently entered the new category of powdered ready to mix beverages which will be piloted in Q4 under new brand "Jynx". This will help us enter an exciting new category which is doing well with Gen-Z and will also offset some of the seasonality in oil demand in summer months."

Shares of Modi Naturals Limited was last trading in BSE at Rs. 206.00 as compared to the previous close of Rs. 207.00. The total number of shares traded during the day was 2909 in over 72 trades.

The stock hit an intraday high of Rs. 211.70 and intraday low of 202.35. The net turnover during the day was Rs. 597400.00.

Source : Equity Bulls


ModiNaturals INE537F01012 Q3FY23 9MFY23 ResultUpdate