{"id":161273,"date":"2024-05-17T07:11:08","date_gmt":"2024-05-17T11:11:08","guid":{"rendered":"https:\/\/44.250.171.167\/?p=161273"},"modified":"2024-05-17T07:11:25","modified_gmt":"2024-05-17T11:11:25","slug":"sanghvi-movers-limited-q4-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/sanghvi-movers-limited-q4-fy24-earnings-conference-call-insights\/","title":{"rendered":"Sanghvi Movers Limited Q4 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from Sanghvi Movers Limited (SANGHVIMOV) Q4 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Financial Performance<\/strong>\n<ul>\n<li>Topline grew 33% YoY to INR647 crores in FY24.<\/li>\n<li>Net profit after tax grew 68% YoY to INR188 crores in FY24, a new historical high.<\/li>\n<li>EBITDA percentage increased by 4% in FY24 compared to FY23.<\/li>\n<li>Average blended yield increased from 1.97% per month in FY23 to 2.2% per month in FY24.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Fleet and Capacity<\/strong>\n<ul>\n<li>Company had a fleet of 346 cranes with an aggregate value of INR2490 crores as of 31st March 2024.<\/li>\n<li>Excluding 47 cranes considered for asset sale with a gross block of INR83 crores and WDV of INR4.75 crores.<\/li>\n<li>Average capacity utilization increased from 83% in FY23 to 84% in FY24.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Capex and Asset Sale<\/strong>\n<ul>\n<li>Completed capex of INR334 crores in FY24.<\/li>\n<li>Planned capex for FY25 is INR250-300 crores, subject to board approval.<\/li>\n<li>Planned capex to be funded 70% from bank borrowings and 30% from internal accruals.<\/li>\n<li>Most of the capex is expected to be completed by December 2024<\/li>\n<li>Added 34 new cranes and 44 other equipment in FY24.<\/li>\n<li>Sold 32 cranes in FY24, generating a profit of INR15.63 lakhs.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Yields and Margins<\/strong>\n<ul>\n<li>Management expects yields to remain flat between 2% to 2.2% in FY25.<\/li>\n<li>Operating margins are expected to decline by 1-2% due to higher contribution from lower-margin EPC business.<\/li>\n<li>Inflationary pressures and salary escalations may also impact margins slightly.<\/li>\n<\/ul>\n<\/li>\n<li><strong>EPC Business Margins<\/strong>\n<ul>\n<li>EPC business contributed INR25.47 crores in revenue with 23% EBITDA margins in FY24.<\/li>\n<li>Margins are expected to decline going forward due to higher volumes and cost pressures.<\/li>\n<li>However, higher volumes in the asset-light EPC business are expected to improve overall returns.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Asset Life and Depreciation<\/strong>\n<ul>\n<li>The company aggressively depreciates cranes as per Companies Act Schedule 2.<\/li>\n<li>However, the economic life of cranes is much higher, leading to higher cash profits.<\/li>\n<li>The company plans to continue with the current depreciation policy.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Remuneration Increase<\/strong>\n<ul>\n<li>Board approved increase in commission for managing directors from 1.5% to 3.5% of net profit for FY24.<\/li>\n<li>This led to an increase of INR5.5 crores in employee costs.<\/li>\n<li>The increase is subject to shareholder approval and may be reconsidered for FY25.<\/li>\n<\/ul>\n<\/li>\n<li><strong>EPC Business Outlook<\/strong>\n<ul>\n<li>EPC business revenue expected to be INR200-250 crores in FY25, a significant jump from INR30 crores in FY24.<\/li>\n<li>Margins for EPC business will be lower than core crane business, leading to some blended margin dilution.<\/li>\n<li>IPP Tie-up and Opportunity<\/li>\n<li>Company incorporated 100% subsidiary Sangreen Renewables Private Limited.<\/li>\n<li>Strategic tie-up with an Independent Power Producer (IPP) to eventually sell stake in Sangreen to the IPP.<\/li>\n<li>IPP tie-up and EPC business present significant growth opportunities across sectors like wind, oil &amp; gas, metros, etc.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Working Capital for EPC<\/strong>\n<ul>\n<li>EPC business is working capital intensive, but tied to crane rental business.<\/li>\n<li>Company mitigates working capital needs by closing crane operations if EPC payments are delayed.<\/li>\n<li>Cash credit interest paid in FY24 was only INR1.62 lakhs on INR100 crore limit, indicating judicious working capital management.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Capacity Expansion Strategy<\/strong>\n<ul>\n<li>Company invested INR924 crores in cranes over the last 4 years, including current year&#8217;s INR200 crore capex.<\/li>\n<li>Despite this, net debt is only INR250-280 crores.<\/li>\n<li>Capacity expansion plans for beyond FY25 are still being finalized.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Debt Position<\/strong>\n<ul>\n<li>Net debt as of FY24 is INR287 crores after netting off INR15 crores of bank FDs against LCs.<\/li>\n<li>If INR70 crores of liquid investments are also netted off, net debt reduces to INR150 crores.<\/li>\n<li>Company aims to maintain some debt for tax benefits but can become debt-free within 12 months.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Order Book Breakup<\/strong>\n<ul>\n<li>Total order book of INR426 crores was disclosed, including EPC orders.<\/li>\n<li>Company had previously announced a INR15 crore EPC order but no details on other EPC orders.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from Sanghvi Movers Limited (SANGHVIMOV) Q4 FY24 Earnings Concall Financial Performance Topline grew 33% YoY to INR647 crores in FY24. Net profit after tax grew 68% YoY to INR188 crores in FY24, a new historical high. EBITDA percentage increased by 4% in FY24 compared to FY23. Average blended yield increased from 1.97% per [&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":[9825,392,5753],"tags":[1703,10169,9403],"class_list":["post-161273","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-earnings","category-industrials","tag-construction","tag-earnings","tag-infrastructure"],"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":158188,"url":"https:\/\/alphastreet.com\/india\/ntpc-limited-q3-fy24-earnings-conference-call-insights\/","url_meta":{"origin":161273,"position":0},"title":"NTPC Limited Q3 FY24 Earnings Conference Call Insights","author":"Praveen","date":"January 31, 2024","format":false,"excerpt":"Key highlights from NTPC Limited (NTPC) Q3 FY24 Earnings Concall Operational Highlights Commercial capacity stands at 57,838 MW on standalone basis and 73,874 MW for the Group. 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