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Jupiter Wagons Ltd Q1 FY25 Earnings Conference Call Insights

Key highlights from Jupiter Wagons Ltd (JWL) Q1 FY25 Earnings Concall

  • Financial Performance
    • Total income reached INR90,219 lakhs, a 19% year-over-year increase.
    • EBITDA grew to INR12,886 lakhs, up 32% with margin improving to 14.4%.
    • PAT increased by 40% to INR8,923 lakhs, with margin growing to 9.9%.
    • Consolidated EBITDA margin of 15.5% was achieved despite challenges.
    • Order book stood at INR7,2834 lakhs as of June 30, 2024.
  • Jupiter Electric Mobility
    • Completed a 26-month trial of 11.2 kilowatt lithium and LFP battery pack for rail coaches.
    • Secured purchase order for LFP auxiliary batteries for Vande Bharat train sets from Siemens.
    • Received ARAI approval for commercial production of one-ton, four-wheel electric LCV, JEM TEZ.
    • Production set to begin in October with initial plan of 500 vehicles in the first year.
  • Bonatrans Acquisition
    • Acquired majority stake in Bonatrans India Private Limited in March 2024.
    • Bonatrans reported 5-fold increase in revenues to INR7,436 lakhs for fiscal year 2024.
    • EBITDA rose to INR930 lakhs with 12.5% margin, PAT reached INR702 lakhs.
    • Aim for turnover of approximately INR400 crores from BIPL for FY2024-25.
    • Plans to expand BIPL’s capacity to machine 28,000 wheelsets in FY25 and up to 40,000-50,000 by FY26.
    • Selling wheelsets to Indian Railways for LHB and Vande Bharat applications, and to metro players.
    • Target to manufacture around 1 lakh wheelset annually, expected completion by 2027.
  • QIP Success
    • Successfully completed qualified institutional placement, raising 800 crores.
    • QIP received overwhelming response with total demand reaching approximately 2,800 crores.
    • Raised capital to be primarily used for establishing forged wheel and axle manufacturing plant.
    • Initiative aims to enhance backward integration and support long-term growth.
    • Creates opportunities to expand into the export market, strengthening growth and market presence.
  • Order Pipeline
    • Current order book stands at close to INR7,000 crores.
    • Indian Railways is undertaking major expansion of track network.
    • Railway freight traffic has grown over 5% and is close to 1600 million tons.
    • Expected wagon demand from Indian Railways is above 30,000 wagons.
    • Private sector demand continues to be robust.
    • Company has started supplies for new specialized wagons like fly ash wagon and auto rake.
    • Developing further new designs to improve demand flow and margins.
  • EBITDA Margins
    • EBITDA margin is nearly 2% higher than the previous full year.
    • Management confirms these margins are sustainable.
    • Wheel business and breaking business expected to contribute significantly to margins.
    • Deliveries of specialized wagons expected to yield better margins.
    • Increasing wheel capacities in Bonatrans will positively impact margins.
  • Capacity Expansion
    • Company is targeting to achieve sales of 10,000 plus wagons this year.
    • Focused on increasing foundry capacity and backward integration.
    • Adding 1,000 tons of foundry capacity by the end of Q3 FY24.
    • No delays in expansion plans; on track to complete by October as previously guided.
  • Battery Technology Plans
    • Plans for backward integration in battery technology.
    • Currently focusing on developing the right technology and getting certified.
  • EV Business Update
    • Company has received approvals from ARAI for their electric vehicle.
    • Commercial production set to start by the end of October.
    • Vehicles will have more than 80% localization.
    • Products will be eligible for government subsidies.
    • Vehicle targets last-mile connectivity with a significant price advantage.
    • Initial focus on B2B segment, particularly aggregators.
    • Discussions ongoing with potential customers to build order book.
    • Company aims to produce 500 EV units in the current financial year.
    • EV sales expected to begin in Q3.
  • Break Segment
    • Company expects to receive licenses from railways shortly for Stone India.
    • Infrastructure upgraded for production.
    • Commercial production expected to start in the next couple of months.
    • Current order book for DAKO business is close to INR150 crore.
    • COVIS business adding incremental orders every month.
    • Company maintaining target of 200-250 crore revenue for FY24-25, including Stone India.
  • Wagon Production Outlook
    • Company maintains confidence in sustaining 15% EBITDA margins.
    • Expect margin improvements as other businesses contribute more.
    • National Rail Plan projects demand for 400,000 rolling stock wagons in next five years.
    • Government commitment to infrastructure spending supports positive outlook.
    • Company targets production of 10,000 wagons for the current year.
  • Container Business
    • Experiencing significant demand, especially for data center and battery containers.
    • Current capacities fully utilized, planning to enhance production capacity.
    • Focused on value-added containers, no longer taking orders for marine containers.
  • Wheelset Manufacturing
    • Ramping up capacity to 30,000 wheelsets by year-end.
    • Initially focusing on domestic market before considering exports.
    • Expecting INR300-400 crore in revenue for the current year.
    • Targeting INR3,000-4,000 crore in revenue once fully integrated.
    • Margins expected to exceed 15% after complete backward integration.
    • Majority of exports to begin after setting up forging facility.
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