Maharashtra Seamless (500265) Q1 24/25 earnings summary

Executive summary

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

• Total revenue for Q1 FY25 was ₹1,216 crore, with PAT at ₹136 crore; consolidated net profit was ₹128.84 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 ₹1,812 crore as of July 2024, with 51% from ONGC & OIL, reflecting strong demand in manufacturing and oil & gas sectors.

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

Financial highlights

• Revenue declined 4% sequentially from Q4 FY24; EBITDA fell 54% to INR 126 crore, with consolidated EBITDA margin at approximately 14.2%.

• PAT and EPS dropped 40% to INR 136 crore and INR 10 per share, respectively, both sequentially and year-over-year.

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

• Standalone revenue for Q1 FY25 was ₹1,150.85 crore, with standalone net profit at ₹135.95 crore.

• Standalone EBITDA margin for Q1 FY25 was approximately 14.3%.

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.

• Market trends indicate rising oil and gas demand in India, with projected 30% increase in oil demand by 2030.

• 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.