Vardhman Special Steel records strong growth driven by increased sales and operational efficiencies

The volumes for the quarter stood at 45,964 tonnes – YoY growth of 45.38%, mainly on account of strong demand from the automotive sector

Jan 20, 2021 03:01 IST India Infoline News Service

Vardhman Special Steels Limited, among India’s leading produceRsof special steels catering to diverse sectoRsof automotive, engineering, tractor, bearing & allied industries, has announced its unaudited financial results for the quarter and nine months ended December 31, 2020.

The company was trading at Rs120.95 per piece up by 2.02% on the BSE at around 3:13 PM.

Performance Highlights:

For the quarter ended December 31, 2020:
  • The volumes for the quarter stood at 45,964 tonnes – YoY growth of 45.38%, mainly on account of strong demand from the automotive sector
  • Revenue from Operations increased 53.05% Y-o-Y to Rs.287.65cr in Q3 FY21, as against Rs187.94cr in Q3 FY20, mainly on account of combination of higher sales volume and sales price
  • EBITDA (including other income) for the quarter was Rs42.64cr as against Rs7.85cr in the corresponding previous period, a Y-o-Y growth of 443.42%, mainly on account of increase in sales volumes, better realizations and higher operational efficiencies
  • Q3 FY21 Profit stood at Rs21.67cr as against profit of Rs1.81cr in Q3 FY20
For the nine months ended December 31st , 2020:
  • The volumes for the nine months stood at 1,02,437 tonnes – YoY increase of 0.95%, despite Q1 performance that was Impacted by COVID-19 nationwide lockdown, higher sales volumes of Q2 & Q3 FY21 helped to achieve volumes for nine months matching with last year
  • Revenue from Operations was Rs602.60cr in 9M FY21, as against Rs640.54cr in 9M FY20, a Y-o-Y decline of 5.92%, mainly on account of lower sales realization in first half of the financial year especially in the first quarter
  • EBITDA (including other income) for nine months was Rs61.63cr as against Rs31.86cr in the corresponding previous period, a Y-o-Y growth of 93.46%, mainly on account of increase in sales volumes, better realizations and higher operational efficiencies
  • 9M FY21 profit at Rs.17.83cr as against loss of Rs0.22cr in 9M FY20
Commenting on the result, Sachit Jain, Vice Chairman & Managing Director, Vardhman Special Steels Ltd. said, “The growing demand in the automotive sector and strong demand from OEMs/component manufactureRsfor our products has helped us to overcome headwinds and post a good performance in terms of volumes in the third quarter. During the quarter, our sales volumes stood at 45,964 tonnes with a revenue of Rs288crs and for nine months volumes stood at 1,02,437 tonnes with a revenue of Rs603crs.

I am pleased to share that our third quarter growth has demonstrated a very satisfactory outcome of our ability to achieve set targets, capture strong demand and be meaningful to our customeRsIt shows our customers, our strong support, our resilience and our way of working and never compromising on quality of our products. On this front we have been constantly engaged in improving our efficiencies and our volumes, thereby improving our EBITDA per ton and have revised our targets of the same from the earlier Rs4,500-6,000 to now Rs5,000-7,000. We further hope to revise this range upwards in a couple of yeaRswhen our expansion gets approved and Aichi business starts. This quarter performance has been beyond our normal range.

We are now adding a new focus of improving our RoCE and hope to achieve a RoCE of 20% by 2025. We hope to achieve this by increasing our volumes, improving the net working capital. In this financial year, we are targeting to cross 14% RoCE and hope to achieve our target. Overall, we remain focused on managing the business for the long term, transforming our business and our ways of working. I am thankful to the entire team at Vardhman for overcoming the uncertainties and driving value for our stakeholders.”

Related Story

Explore Important Blogs