Welspun Corp Ltd's Q3FY19 consolidated net profit declines 54.7% yoy to Rs30cr

The company’s consolidated revenue stood at Rs2,658cr, up 15.4% yoy and 12.9% qoq.

February 07, 2019 8:58 IST | India Infoline Research Team

Welspun Corp Ltd Q3FY19

Consolidated Results Q3FY19: (Rs. in cr)

Q3FY19 YoY (%)
Revenue 2,658 15.4
EBITDA 223 35.9
EBITDA Margin (%) 8.4 127
Net Profit (adjusted) 30 [54.7]
***EBITDA margin change is bps

Welspun Corp reported a sharp drop in net profit for Q3FY19 despite strong growth on the revenue and EBITDA front. Revenue rose by 15.4% yoy to Rs2,658cr. EBITDA stood at Rs223cr, up 35.9% yoy. EBIDTA margin rose by 127bps yoy to 8.4%. Net Profit stood at Rs30cr in Q3FY19, down 54.7% yoy.
  • Total pipe production and sales for Q3FY19 stood at 343k MTs (up 30.4% yoy) and 339k MTs (up 6.6% yoy) respectively. Production of plates/coils stood at 80k MTs, down 40.7% yoy.
  • The break down for pipe sales by region for Q3FY19 stood at:
    • India - 38%
    • US – 39%
    • Saudi Arabia – 23%
  • Current order book stands at 1,656k MTs (Rs11,100cr) up 29.6% yoy. The breakdown for the order book by region is:
    • Rest Of World – 446k MTs (27% of total)
    • Americas – 338k MTs (23% of total)
    • Saudi – 823k MTs (50% of total)
  • EBITDA/tn for the pipes segment stands at ~Rs6,600 for Q3FY19 against ~Rs5,200cr in Q3FY18 (up 27.5% yoy).
  • Net debt at the end of December 2018 stood at Rs312cr, with the gross debt at Rs1,462cr and Rs1,150cr in cash. This is a significant deleveraging from a net debt of Rs642cr in Q3FY18. The net debt-to-EBITDA for Q3FY19 stood at 0.37x, down from 0.67x in Q3FY18.
  • The net working capital scenario for the company declined in Q3FY19.  Working capital days grew to 46 days in Q3FY19 from 32 days in Q2FY19. This was achieved due to an increase in inventory and debtor days as well as a reduction in creditor days.

Technical View:

Welspun Corp Ltd ended at Rs. 106.35, up by 4 points or 3.91% from its previous closing of Rs. 102.35 on the BSE.
The scrip opened at Rs. 103 and touched a high and low of Rs. 114.80 and Rs. 93 respectively. A total of 27,58,529 (NSE+BSE) shares were traded on the counter. The stock traded above its 200 DMA.

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