Yash Pakka Limited Q4 FY22 Earnings Conference Call Insights

Key highlights from Yash Pakka Limited (516030) Q4 FY22 Earnings Concall

Q&A Highlights:

• Manish asked about the input cost and if it has been passed to the end client and the outlook going forward. Jagdeep Hira MD said that last year the company has not been able to take the full return on the increased input cost. Going forward the company expects to mitigate some of the input cost.

• Manish asked about company’s borrowing going forward. Jignesh Shah CFO said that vs. the previous year, the borrowing should have gone down because the company has repaid its term loans for the entire business. The increase is coming only from the working capital finance. Expects the borrowing to remain at this range at the end of the year next year.

• Jeet Bala asked about the innovation in flexible packaging the company is doing. Sagar Shejwalkar Innovations Head said there has been a substantial renovation regarding the product in the flexible packaging structure.

• An analyst asked about the time frame for a substantial turnaround in CHUK. Satish C Business Head said the company is looking at additional capacity acquisition through franchisee manufacturer. Also launching newest line of products in next quarter. The company will be able to see a quantum leap in the next 1-2 quarters.

• An analyst also asked if the company is looking at holding any analyst meet with any FIIs or DIIs to attract investment in the stock. Ved Krishna Vice-Chairman replied that the company has not thought about it. The company’s aim is the business, but not the stock price. To attract FII, specific activities will be done when needed.

• Girish Makwana asked about the lead products, food, take away and if the company is ready with it.  Satish Chamyvelumani Business Head replied that in terms of design, performance and testing the company is fully ready and said it has been tested with several key customers over the last year. The company expects the glitches to be resolved in 1Q23.

• Sumesh Galleria enquired how the company is going to achieve the revenue target of INR500 crore for FY23. Ved Krishna Vice-Chairman replied that mostly the shift in focus will come from the whole outsourcing model. The turnover from the molded segment is expected to go from INR300 crores odd to INR500 crores. Also capacity utilization and NSRs are expected to go up.

• Pranay asked about the reason for steep rise in other expenses in 4Q22 and if there was any one-time expense. Jignesh Shah CFO replied that steep rise was mainly coming from the write off of the [fixed asset], which is a one-time expense of INR2 crores.