Welspun India Ltd (NSE:WLSI) Q1 2020 Earnings Conference Call Transcript

Jul 30, 2019 • 06:30 am ET

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Welspun India Ltd (NSE:WLSI) Q1 2020 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, good day and welcome to the Welspun India Limited Q1 FY20 Earnings Conference call hosted by Equirus Securities Private Limited. [Operator Instructions].

I now hand the conference over to Mr. Vikas Jain from Equirus Securities Private Limited. Thank you and over to you Mr. Jain.

Analyst
Vikas Jain

Thank you. Good evening everyone, on behalf of Equirus Securities, I would like to welcome all of you to the Q1 FY20 earnings conference call for Welspun India. From the company, we have with us the key senior management including Mr. Rajesh Mandawewala, Managing Director, Mr. Altaf Jiwani, Director Finance & CFO and Mr. Akhil Jindal, Group CFO and Head Strategy.

I would now like to hand over the call to the management for their opening comments, post which we will open the floor for the Q&A. Thank you and over to you sir.

Executive
Altaf Jiwani

Thank you. Good evening, ladies and gentlemen. On behalf of Welspun India, I would like to welcome all of you to our Q1 Con-call. So we have had actually Q1 very strong profitability coupled with that deleveraging. So we have seen a turnover of INR1736 crores, which is double digit growth compared to the same quarter last year. The EBITDA is at INR371 crores, which is a margin of 21.4%. So again, this is 77 basis point higher than the same quarter last year and it is substantially higher than the Q4 EBITDA, which was 15.8%

In terms of PAT, we are at INR150 crore, which is 17.9% growth in EPS compared to the same quarter last year. And the borrowing level has actually come down substantially. So we are net debt, we are at INR2815 crores compares to INR3028 crores as of March 31st March 2019. Now, if we see the core business, which is the home textile business, we have actually reduced the borrowing by almost INR412 crores in Q1. So there's been a substantial cash flow generation in the core business which has led to this kind of reduction in the debt level. And we also had debtor number of days have come down with the better management, we had some government receivables which we received during this quarter.

All this factors have actually helped us reduce the borrowing level. We have as far as the top line is concerned, it is the growth, it has three factors which have it's a combination of three factors. One is the currency, which is about 4.8% growth impact, 3.4% is because of the revision in the ROCCL, which happened in March, last financial year, and there is a 3.4%, which is about the volume and the unit value relation which has resulted into growth in top line. As far as Welspun flooring is concerned, we have come to our almost end up our capex cycle in this financial year now. We have invested INR850 crores as of 30, June for Welspun flooring business out of INR1100 crores. And the core business does not require too much of capex