RHI Magnesita India (534076) Q4 24/25 earnings summary

Executive summary

• FY2025 was marked by challenges such as intensified competition, rising input costs, and commoditization, but operational resilience, strategic focus, and disciplined cash management enabled value creation and record cash flow.

• Maintained market leadership in refractories with a 30% share, expanded presence through acquisitions, and advanced growth in iron making, pellet, and DRI segments.

• Board approved audited results with unmodified opinions, recommended a final dividend of Rs. 2.50 per share, and made key board appointments to strengthen governance.

• Focused on safety, achieving LTIF of 0.046 and conducting 79,751 hours of safety training.

• Acquisition of Ashwath Technologies is pending, aligning with strategic growth objectives.

Financial highlights

• FY2025 consolidated revenue declined 2.8% year-on-year to INR 3,675 crores (₹367,450 lakh), with flat shipments.

• EBITDA for FY2025 was INR 505 crores, with margin softening to 13.7% from 14.7% in FY2024 due to higher raw material and employee costs.

• Profit after tax was INR 203 crores (₹20,251.28 lakhs), a turnaround from a loss in FY2024, aided by disciplined execution and absence of exceptional items.

• Operating cash flow increased 38% to ₹37,308 lakh year-over-year.

• Net debt reduced by 53% during the year, with net debt-to-EBITDA ratio improving to 0.3x from 0.6x.

Outlook and guidance

• Management expects medium-term demand fundamentals to remain strong, with domestic steel capacity expansion and infrastructure-led cement demand recovery in FY2026.

• Margin improvement is anticipated from Q2 FY2026, driven by lower raw material costs, price increases, and product optimization.

• 8%-10% volume growth is targeted for the coming year, with upside expected from July onwards as price increases and cost benefits take effect.

• Strategic investments and capacity expansions are planned, including a new taphole clay line and increased R&D spending.

• Acquisition of Ashwath Technologies is expected to strengthen product and service offerings in the domestic engineering and refractory solutions sector.