Any current/future new fundraising through debt or equity?

Kamdhenu Limited is raising INR 100 crores through the issue of convertible warrants on a preferential basis over the next 18 months. So far, INR 24.27 crores have already been received from this fundraising. The capital raise aims to remodel the franchisee business by acquiring stakes in some franchisee units. Funds will also be used for investing in existing and new business ventures in India or overseas for diversification. Additional planned uses include CapEx in existing manufacturing units, acquiring or setting up new office premises, and enhancing brand positioning to leverage overall b

Any current/future capex/capital investment/strategic investment?

Kamdhenu Limited is raising INR 100 crores through the issue of convertible warrants on a preferential basis over the next 18 months, with INR 24.27 crores already received. The raised funds will be deployed to remodel the franchisee business by strategically acquiring stakes in some franchisee units. Investment will also be made in existing and new business ventures in India and overseas for diversification. CapEx plans include investments in existing manufacturing units and acquiring or setting up new office premises. The company plans to enhance and strengthen its brand position and corpora

Future growth expectations in sales/revenue/volumes?

Kamdhenu Limited targets doubling steel business revenue in the next 5 years, increasing franchisee steel volume from 32.5 lakh MT in FY '24 to 68 lakh MT by FY 2029. They aim to raise franchisee capacity from current ~41 lakh MT to 50 lakh MT in FY '25. Expected steel industry growth is 8%-9% annually, but Kamdhenu plans to grow at 16%-17%, outpacing the industry. Paint business revenue expected to grow from INR 292 crores in FY '24 to around INR 380 crores in FY '25, with EBITDA margin improving from 8% to 9.5%. The company focuses on value-added/premium products to drive both volume

Future growth expectations in earnings/operating earnings/profits/EPS?

Kamdhenu Steel business targets to double revenue in next 5 years, increasing franchisee capacity from 41 lakh MT to 68 lakh MT by 2029. EBITDA margin for paint business expected to improve from 8% in FY '24 to 9.5% in FY '25. Paint business revenue targeted to grow over 20% in FY '25 from INR 292 crores in FY '24 to approximately INR 380 crores. Steel business PBT grew 22% YoY in FY '24; aims to sustain and improve margins with royalty per tonne expected to increase from INR 395 to INR 500 over next 5 years. Steel segment pursuing 16-17% annual volume growth, well above industry growth of 8-1

Current/ Expected Orderbook/ Pending Orders?

Kamdhenu Limited's franchisee units typically maintain a fully booked order book, with capacity utilization around 60-70%. Steel segment capacity utilization is relatively moderate due to single-shift operations. The asset-light franchisee model ensures steady demand and utilization among franchisees. No specific numeric value for total pending orders or order book size disclosed. Management indicated ongoing efforts to increase capacity, from current 41 lakh metric tonnes to 50 lakh metric tonnes in FY '25 and targeting 68 lakh metric tonnes by 2029. The model supports continuous demand withi

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Kamdhenu LtdQ1 FY25Industrial Products

Kamdhenu Ltd Q1 FY25 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹33.5P/E: 8.3Market Cap: ₹652 CrSector: Industrial Products

Management growth scorecard

Revenue

Category 2

Margin

Category 3

Fundraise

Yes

Order

N/A

Capex

Yes

2 of 4 growth signals are positive.

Full analysis

Revenue guidance

Category 2

→Kamdhenu Limited targets doubling steel business revenue in the next 5 years, increasing franchisee steel volume from 32.5 lakh MT in FY '24 to 68 lakh MT by FY 2029.
→They aim to raise franchisee capacity from current ~41 lakh MT to 50 lakh MT in FY '25.
→Expected steel industry growth is 8%-9% annually, but Kamdhenu plans to grow at 16%-17%, outpacing the industry.
→Paint business revenue expected to grow from INR 292 crores in FY '24 to around INR 380 crores in FY '25, with EBITDA margin improving from 8% to 9.5%.
→The company focuses on value-added/premium products to drive both volume and value growth.
→Expansion primarily through scaling capacity of existing franchisees, rather than increasing franchisee numbers.
→Market expansion focus on Tier 2 and Tier 3 cities, smaller towns, and underserved regions.

Margin guidance

Category 3

→Kamdhenu Steel business targets to double revenue in next 5 years, increasing franchisee capacity from 41 lakh MT to 68 lakh MT by 2029.
→EBITDA margin for paint business expected to improve from 8% in FY '24 to 9.5% in FY '25.
→Paint business revenue targeted to grow over 20% in FY '25 from INR 292 crores in FY '24 to approximately INR 380 crores.
→Steel business PBT grew 22% YoY in FY '24; aims to sustain and improve margins with royalty per tonne expected to increase from INR 395 to INR 500 over next 5 years.
→Steel segment pursuing 16-17% annual volume growth, well above industry growth of 8-10%, contributing to substantial earnings growth.
→Overall, Kamdhenu expects PAT and EBITDA growth backed by capacity expansion, improved realizations, cost control, and premium product focus.

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Fundraise plans

Yes

→Kamdhenu Limited is raising INR 100 crores through the issue of convertible warrants on a preferential basis over the next 18 months.
→So far, INR 24.27 crores have already been received from this fundraising.
→The capital raise aims to remodel the franchisee business by acquiring stakes in some franchisee units.
→Funds will also be used for investing in existing and new business ventures in India or overseas for diversification.
→Additional planned uses include CapEx in existing manufacturing units, acquiring or setting up new office premises, and enhancing brand positioning to leverage overall brand premium.
→No specific mention of new debt fundraising was made; the company continues to remain debt-free as of March 31, 2024.

Order book

→Kamdhenu Limited's franchisee units typically maintain a fully booked order book, with capacity utilization around 60-70%.
→Steel segment capacity utilization is relatively moderate due to single-shift operations.
→The asset-light franchisee model ensures steady demand and utilization among franchisees.
→No specific numeric value for total pending orders or order book size disclosed.
→Management indicated ongoing efforts to increase capacity, from current 41 lakh metric tonnes to 50 lakh metric tonnes in FY '25 and targeting 68 lakh metric tonnes by 2029.
→The model supports continuous demand within a 200-300 km radius to minimize transportation costs, sustaining franchisee order levels.

Capex plans

Yes

→Kamdhenu Limited is raising INR 100 crores through the issue of convertible warrants on a preferential basis over the next 18 months, with INR 24.27 crores already received.
→The raised funds will be deployed to remodel the franchisee business by strategically acquiring stakes in some franchisee units.
→Investment will also be made in existing and new business ventures in India and overseas for diversification.
→CapEx plans include investments in existing manufacturing units and acquiring or setting up new office premises.
→The company plans to enhance and strengthen its brand position and corporate image to leverage brand premium.
→Specifically, for Q1 FY '25, the company expects to deploy INR 25 crores of cash raised recently.
→For setting up a greenfield TMT bar capacity of 1 lakh metric tonnes annually (though not viable), CapEx is estimated at INR 70-80 crores excluding land; a capacity of 2 lakh metric tonnes requires about INR 70-80 crores excluding land.
→Overall, capital spending will support capacity expansion, strategic acquisitions, and brand-building initiatives.

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