Maharashtra Seamless (500265) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 earnings and margins declined significantly due to lower sales realization, preventive maintenance shutdown, and inventory markdown from falling raw material prices.

• Total revenue for Q1 FY25 ranged from ₹1,150.98 crore to ₹1,216 crore, with PAT between ₹128.84 crore and ₹136 crore.

• Treasury income contributed over one-third of total earnings, with treasury at INR 2,203 crore as of June 30, 2024.

• Order book increased to INR 1,812 crore, reflecting strong demand in manufacturing and oil & gas sectors.

• Board recommended the appointment of two new Independent Directors, both with extensive industrial experience.

Financial highlights

• Revenue declined sequentially and year-over-year; EBITDA for Q1 FY25 ranged from ₹126 crore to ₹276 crore, with margins between 14.2% and 23%.

• PAT and EPS dropped sharply, with EPS for Q1 FY25 between ₹9.65 and ₹10.15.

• EBITDA per ton dropped from INR 22,000 to INR 9,000 due to lower realizations, shutdown, and inventory markdown.

• Treasury income was a significant contributor to overall earnings.

• Overseas subsidiaries reported a net loss of ₹759.58 crore for Q1 FY25.

Outlook and guidance

• Normalization of dispatches and reversal of inventory markdown expected in Q2 and Q3 FY25 as high-value orders are executed.

• No volume growth expected in FY25; growth anticipated post-Telangana finishing line commissioning in FY26.

• No new debt required for planned capex and working capital; all to be funded from internal accruals.

• Dividend for FY24 quadrupled versus FY22; no current update on further dividend or buyback.

• Tax liability/provision is based on estimated annual computation; adjustments will be made in the last quarter.