Usha Martin (517146) Q2 24/25 earnings summary

Executive summary

• Achieved 13.6% YoY revenue growth in Q2 FY25, led by strong wire rope and wire segment performance, with international business contributing 55% of H1 FY25 revenues.

• Wire rope division contributed 73% to consolidated revenues, with 19.2% YoY revenue growth and value-added products driving margin stability.

• Net profit after tax for Q2 FY25 was INR 109.3 crore, nearly flat YoY, with prior year including INR 18 crore one-time income.

• Value-added industry segment revenue share rose to 54% in H1 FY25, supporting margin stability.

• Ongoing CapEx in Ranchi, Thailand, and the UK (synthetic slings) to support future growth and product diversification.

Financial highlights

• Q2 FY25 consolidated net revenue: INR 891.2 crore, up 13.6% YoY; H1 FY25 net revenue: INR 1,717.5 crore, up from INR 1,599.1 crore YoY.

• Q2 FY25 operating EBITDA: INR 160.8 crore (18% margin), up from INR 144.3 crore YoY; EBITDA per ton: INR 32,253.

• Q2 FY25 net profit: INR 109.3 crore; PAT margin at 12.3%.

• H1 FY25 operating EBITDA: INR 314.8 crore, up from INR 290 crore YoY; profit after tax: INR 213.2 crore, up from INR 210.3 crore YoY.

• Net debt as of 30th September 2024: INR 127 crore, up slightly from INR 124 crore as of 31st March 2024, due to CapEx.

Outlook and guidance

• Expecting 10%-12% volume and top-line growth in FY25 and FY26, driven by CapEx and capacity expansion.

• EBITDA margin guidance maintained at 18%-20%, with a focus on sustaining INR 32,000 per ton EBITDA.

• Management expects to sustain growth momentum in H2 FY25, supported by seasonally stronger demand and expanded capacities.

• Anticipate gradual improvement in EBITDA per ton as product mix shifts further toward value-added products.

• International and domestic markets both expected to deliver 10%-12% annual growth over the next 2-3 years.