SUPREMEIND Q3 FY24 earnings call.
A source-linked concall view: reported numbers, management language, guidance, commitments and risks that should carry forward.
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Revenue
₹2,429 Cr
verified against source
Revenue YoY
6%
reported change
EBITDA
₹400 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
Where this quarter sits.
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What the record says.
Supreme Industries delivered a 21% YoY EBITDA growth to INR 400 crore and 22% PAT growth to INR 256 crore in Q3 FY24, with margins expanding 280bps to 16.5% through product mix optimization and specialization. Volume growth of 17% in plastic piping and 30%+ in 9M FY24 significantly outpaced the Indian PVC market's 15% growth, indicating substantial market share gains. Management upgraded FY24 plastic pipe volume growth guidance to 30% (from 28%), with 12-15% growth targeted for FY25. The INR 1,000 crore CapEx commitment (including Parvati acquisition) will expand capacity from 800,000 to 1,000,000 tons by December 2024. Risks include PVC price volatility (INR 51 crore inventory loss in 9M), uncertainty around anti-dumping duty renewal on CPVC, and competitive pricing pressure causing ~10% CPVC realization decline. The company maintains a debt surplus of INR 586 crore with strong cash generation, entirely funding expansion from internal accruals.
Colored figures show movement against the previous available record.
Guidance to track
- Company achieved 30.4% volume growth in 9M FY24 and expects to maintain this trajectory for full year, outpacing earlier guidance of 28%. Growth driven by infrastructure and housing demand with favorable PVC pricing.
- Management guided for 12-15% volume growth in the plastic piping segment for FY25, a more moderate but still healthy trajectory compared to FY24's exceptional performance.
- Total commitment including Parvati acquisition and carry-forward from previous year may exceed INR 1,000 crore, with cash outflow not exceeding INR 750 crore for FY24, entirely funded from internal accruals.
- Total capacity to increase from 800,000 tons (April 2023) to approximately 1,000,000 tons by December 2024, including Parvati's 36,000 tpa capacity and greenfield/brownfield expansions.
Risks flagged
- Analyst raised concern about anti-dumping duty on CPVC raw material expiring next year. Management deflected, stating 'that detail is given by government only', creating uncertainty around CPVC segment cost structure and competitive dynamics.
- Multiple new suppliers have entered the CPVC market, causing approximately 10% price decline in realizations. This could impact margins if the trend continues, particularly with anti-dumping duty renewal uncertain.
- Company incurred INR 51 crore inventory loss in 9M FY24 due to PVC price decline. Further volatility could impact margins, though management sees polymer prices stabilizing at 'acceptable levels'.
- Packaging (3% volume growth), Industrial Components (weak demand from appliances/white goods), and Consumer Products (-3% degrowth) are not contributing to overall growth. Management indicated consumer will remain volume-flat as it shifts to premium products.
Key quotes
- In the first nine months, we have grown by 30.4%, and the volume price has become further approachable, and there is good demand from infrastructure and housing. Last year, in the month of January and February, demand was low. So when we say that we will grow 30% for the year, nine months we have grown by 30.4%, and the remaining three months, business conditions are looking better compared to last year.
- Our company market share increased. The Indian market of PVC has grown up by 15% in the first nine months. CPVC has grown by 2% by volume. Our company has grown by 30% and overall in piping, in which CPVC has grown by 8% and PVC has grown by more than 24%.
- We are increasing our range of product more and more, and our piping system, our range is now in excess of 16,000 SKUs. We are making more and more specialized products. It may not fall in the value-added product. Our criteria of value-added product is it must earn 17%. But if are lower than 17%, they don't fall in value-added product what we declare to us, but definitely it become higher than 15%, which enable us to enjoy a margin of around 15.5%. This trend will continue.
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