Eveready Inds. Q1 FY25 Earnings Call Analysis
Revenue, margin, capex, fundraise and order book outlook from management commentary.
Management growth scorecard
Revenue
Category 3
Margin
Category 3
Fundraise
Yes
Order
N/A
Capex
Yes
2 of 4 growth signals are positive.
Full analysisRevenue guidance
Category 3- Battery Segment:
- - Expecting mid-single-digit growth in volume.
- - Alkaline battery market growing at ~20% CAGR; ready to tap this with new 360 million capacity plant.
- - Carbon zinc segment stagnant; focus shifting to premium alkaline products.
- - Alkaline to drive double-digit growth in the coming years.
- Flashlight Segment:
- - Anticipated double-digit growth, specifically 10-15% growth outlook.
- - Focus on rechargeable flashlights and innovative products to regain market share.
- Lighting Segment:
- - Wide growth potential; targeting breakeven at Rs. 400 crore turnover and moving towards profitability.
- - Recently achieved positive EBITDA.
- Additional Initiatives:
- - Exploring new categories (fourth category) in 4-6 quarters for further growth.
- - Expanding alternative sales channels (modern retail, e-commerce) for increased market reach.
See what Eveready Inds. management said on margin guidance — free account, 30 seconds.
Fundraise plans
Yes- The company plans a Rs. 180 crore investment to set up an alkaline battery plant with 360 million units capacity.
- Funding for this investment will be partly through internal accruals and largely through borrowed funds to avail possible interest benefits.
- No specific mention of new equity fundraising was noted.
- Current net debt stands around Rs. 260 crore with an average borrowing cost of 8.7%.
- No other explicit plans for fresh debt or equity fundraising were discussed in the provided transcript.
See what Eveready Inds. management said on order book — free account, 30 seconds.
Capex plans
Yes- The company has approved a capital investment of Rs. 180 crore to set up an alkaline battery manufacturing plant with a capacity of 360 million units.
- Currently, alkaline batteries are imported and only repacked in India; this will be the first alkaline facility in the country for the company.
- The investment aims to gradually scale production from the current throughput of 60 million units to higher utilization in 3-4 years.
- The asset turnover is expected to reach 1:1 around the third year of operation.
- Funding for the investment will be partly internal and partly borrowed, considering potential interest benefits.
- There is also consideration for exploring a fourth product category within 4 to 6 quarters, though work on this has not yet started.
- Ongoing initiatives include modernizing go-to-market processes and expanding distribution channels beyond general trade to boost growth.
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