{"id":158559,"date":"2024-02-07T10:29:01","date_gmt":"2024-02-07T15:29:01","guid":{"rendered":"https:\/\/44.250.171.167\/?p=158559"},"modified":"2024-02-07T10:29:13","modified_gmt":"2024-02-07T15:29:13","slug":"ccl-products-india-ltd-q3-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/ccl-products-india-ltd-q3-fy24-earnings-conference-call-insights\/","title":{"rendered":"CCL Products (India) Ltd Q3 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from CCL Products (India) Ltd (CCL) Q3 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Financial Performance<\/strong>\n<ul>\n<li>Revenue of INR664.48 crores for Q3 FY2024, up 24% vs last year.<\/li>\n<li>Net profit of INR63.29 crores, down 13% vs last year.<\/li>\n<li>EBITDA of INR112 crores.<\/li>\n<li>About 800 metric tons of shipments deferred from Dec. to Jan. which led to lower Q3 sales than expected.<\/li>\n<li>9 months YTD revenue of INR1,926 crores, up 24% vs last year.<\/li>\n<li>9 months YTD EBITDA of INR329 crores, up 15%.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Outlook<\/strong>\n<ul>\n<li>Expects to meet full year revenue growth guidance.<\/li>\n<li>Volume growth expected to recover in Q4.<\/li>\n<li>Profit guidance impacted by Vietnam issue pending insurance claim.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Coffee Outlook<\/strong>\n<ul>\n<li>No slowdown in coffee demand seen.<\/li>\n<li>If anything, pent-up demand driving prices higher.<\/li>\n<li>Vietnam crop concerns adding to tight supply perceptions.<\/li>\n<li>Coffee prices at multi-decade highs and keep rising.<\/li>\n<li>Tight supply outlook and speculative buying driving prices.<\/li>\n<li>Prices expected to remain high in near term.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Capacity Expansion<\/strong>\n<ul>\n<li>India capacity expansion on track for March.<\/li>\n<li>Vietnam expansion on track for Jul-Sep quarter.<\/li>\n<li>Vietnam has 40-50% volume growth from new capacity and aggressive selling.<\/li>\n<li>Low margin contracts impacted consolidated margins by 2-3%.<\/li>\n<li>Expansions to help meet robust market demand.<\/li>\n<\/ul>\n<\/li>\n<li><strong>India Business Growth<\/strong>\n<ul>\n<li>India domestic business at INR230-235 cr in 9 months.<\/li>\n<li>Branded business at INR145 cr in 9 months, projected to reach INR200 cr this year.<\/li>\n<li>Seeing 40-50% growth momentum in brands after correction in Q1\/Q2.<\/li>\n<li>Growth across GT, MT and e-commerce channels.<\/li>\n<\/ul>\n<\/li>\n<li><strong>UK Acquisition Update<\/strong>\n<ul>\n<li>Transition period over, started taking over operations from July.<\/li>\n<li>Spent 4-5 months reworking product, packaging, promotions with partners.<\/li>\n<li>Relaunch with new packaging and products end of March.<\/li>\n<li>This year&#8217;s numbers not significant, only 15 stores.<\/li>\n<li>Will update after March relaunch on market response.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Margin\/EBITDA Outlook<\/strong>\n<ul>\n<li>No major deviation expected in margins.<\/li>\n<li>Product mix changes between spray dried and freeze dried to impact margins.<\/li>\n<li>Focus on small packs and specialty coffee to improve margins.<\/li>\n<li>Offset by factors like Vietnam lower margin contracts.<\/li>\n<li>Guidance of volume and EBITDA growth remaining aligned holds at annual level.<\/li>\n<li>Confident of achieving 18-20% EBITDA growth guidance.<\/li>\n<li>Vietnam losses and margin pressure while catching up volumes impacts growth.<\/li>\n<li>Volume-led growth in next 2 years rather than margin expansion.<\/li>\n<li>Small packs ratio increasing gradually from 20% now.<\/li>\n<li>30% ratio over time to drive margin improvement.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Working Capital<\/strong>\n<ul>\n<li>Working capital facility increased by INR200 cr in India to INR600 cr.<\/li>\n<li>Vietnam working capital limit increased from $15 million to $45 million.<\/li>\n<li>Overall working capital increased from INR600 cr to INR1000 cr.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Business Growth<\/strong>\n<ul>\n<li>Currently have 4,000 vending machines, looking to build aggressively.<\/li>\n<li>Adopting cautious approach for sustainable model.<\/li>\n<li>Target to build INR100 cr business from vending in next 3-5 years.<\/li>\n<li>Work with many coffee D2C brands and chains on backend.<\/li>\n<li>Aiming for INR200 cr branded business this year.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Gross Margin and Ad Spend<\/strong>\n<ul>\n<li>30% gross margins for overall domestic business.<\/li>\n<li>5-7% higher for branded business specifically.<\/li>\n<li>Ad spend at 8-10% of sales.<\/li>\n<\/ul>\n<\/li>\n<li><strong>China Business Potential<\/strong>\n<ul>\n<li>Negligible volumes currently to China.<\/li>\n<li>Seeding market in partnership with associate.<\/li>\n<li>Expect volumes to start picking up going forward.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from CCL Products (India) Ltd (CCL) Q3 FY24 Earnings Concall Financial Performance Revenue of INR664.48 crores for Q3 FY2024, up 24% vs last year. Net profit of INR63.29 crores, down 13% vs last year. EBITDA of INR112 crores. About 800 metric tons of shipments deferred from Dec. to Jan. which led to lower [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,6351,392],"tags":[8765,952,10169],"class_list":["post-158559","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-consumer-stocks","category-earnings","tag-coffee","tag-consumer-goods","tag-earnings"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":158624,"url":"https:\/\/alphastreet.com\/india\/pondy-oxides-and-chemicals-ltd-q3-fy24-earnings-conference-call-insights\/","url_meta":{"origin":158559,"position":0},"title":"Pondy Oxides and Chemicals Ltd Q3 FY24 Earnings Conference Call Insights","author":"Praveen","date":"February 9, 2024","format":false,"excerpt":"Key highlights from Pondy Oxides and Chemicals Ltd (POCL) Q3 FY24 Earnings Concall Financial Performance Revenue of INR 454 crores, up 16% YoY and 12% QoQ. 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