Triveni gains after board OKs Rs 800-cr buyback; Q2 PBT before EI down 80% YoY

7 Nov 2022 , 09:44 AM

The maximum consideration payable in cash for the proposed buyback shall not exceed Rs 800 crore, the company said. The number of shares that the company proposes to buyback represents 9.45% of the total issued and paid-up equity share capital of the company as on 30 September 2022. The board of directors also noted the intention of the promoters and members of the promoter group of the company to participate in the proposed buyback. While the promoters & the promoter group held 68.257% stake, the remaining 31.743% stake was held by public shareholders as on 28 October 2022. The companys board also approved the audited standalone and consolidated financial results of the company for the second quarter and half-year ended 30 September 2022. Triveni Engineering after the companys consolidated net profit zoomed to Rs 1,387.76 crore in Q2 FY23 from Rs 92.47 crore recorded in Q2 FY22. Net revenue from operations increased by 27% YoY to Rs 1,345.89 crore during the quarter. While EBITDA declined by 50.8% to Rs 57.09 crore, EBITDA margin fell by 700 bps to 4% in Q2 FY23 over Q2 FY22. Share of income from associates in the second quarter was Rs 7.96 crore (down 79% YoY). Profit before tax before exceptional items in Q2 FY23 stood at Rs 24.48 crore, down by 79.8% from Rs 121.46 crore in Q2 FY22. The company said that the contribution on sale of sugar during the current periods is lower due to the impact of higher sugarcane price (State Advised Price) in the SS 2021-22 not fully compensated by increase in sugar realizations. In addition, Q2 FY22 included export subsidy of Rs 11.7 crore, pertaining to export booked during the previous period/s (but relating to earlier periods). Excluding the impact of this, the decline in PBT before EI would be 77.7% for Q2 FY23. Triveni Engineering further informed that it has divested its entire stake of 21.85% in the associate company, Triveni Turbine (TTL), and accordingly exceptional income of Rs 1401.20 crore has been recognized. Share of profit from TTL has been considered up to 20 September 2022 and thereafter, it ceases to be an associate company. Net divestment proceeds of Rs 1,593 crore are held in fixed deposits with various banks. On a consolidated basis, the total debt was at Rs 720.73 crore (net of FD of Rs 148 crore made from operational surplus) as on 30 September 2022 as against Rs 1,567.96 crore as on 31 March 2022. The above debt position is without considering net divestment proceeds of Rs 1,593 crore held in fixed deposits with various banks. Overall average cost of funds is at 5.16% during Q2 FY23 as against 5.09% in the corresponding period of previous year. Dhruv M. Sawhney, chairman and managing director, Triveni Engineering & Industries, said: Sugar and distillery segments witnessed higher dispatches during Q2 / H1 FY 23 with higher realizations. The profitability in the sugar business has been impacted by higher cost of sugar produced in the SS 2021-22 owing to increase in sugarcane price, which could not be fully compensated by increased sugar realization prices. Similarly, the profitability of the distillery segment is somewhat subdued due to increased transfer pricing of B-heavy molasses. We have commenced production of Ethanol/ENA from the grains and have now stabilized the operations. We have commenced sugarcane crushing at six sugar units and the sugar unit at Ramkola is scheduled to commence during second week of November. As a result of the debottlenecking and modernization carried out at our three sugar units and based on the crop position presently prevailing, our performance, both in terms of crush and recovery, is likely to be better and the refined sugar may constitute approximately 60% of the total sugar production. We presently have total capacity of 660 KLPD under the distillery segment which we have planned to increase to 1110 KLPD by setting up two more distilleries. The engineering business continue to perform well with healthy order books and enquiry pipelines. In the Power Transmission business, strong domestic economy and focus on growth in export markets is a key growth driver. Triveni Engineering & Industries (TEIL) is a diversified industrial conglomerate having core competencies in the areas of sugar and engineering. The company is one of the largest integrated sugar manufacturers in India and amongst the leading players in its engineering businesses comprising Power Transmission business and Water & Wastewater treatment solutions. Powered by Capital Market – Live News