Stove Kraft Ltd

- No explicit mention of any current or planned new fundraising through debt or equity in the call. - Company focused on substantial debt reduction, having reduced debt by INR 80 crores during the quarter. - Aim to become cash debt-free by year-end, with normal bank borrowings expected to be close to zero. - Some lease financing and supplier credit remain, but overall net debt targeted to approach zero soon. - No indications or plans disclosed about equity fundraising. - Management emphasizes operating cash flow generation and optimizing working capital rather than raising new funds.

- Capex payments net INR 63 crores made in the 9 months period. - Capitalization of IKEA facility pending; expected to be completed 100% before March-end. - The plant setup and product development for export business (notably IKEA) completed, with revenue start expected at the end of the current quarter and meaningful revenue from next year. - Investment focus on expanding in-house manufacturing to manage costs and ensure quality, especially due to rising imported component and commodity prices. - Ongoing store expansion with a target of 500 exclusive Pigeon retail stores by 2027; currently at 313 stores across 21 states and 138 cities. - Strong emphasis on strategic investments to drive product innovation in small domestic appliances and consumer appliances.

- Domestic business expected to sustain double-digit growth for next 2-3 years, with leadership in key categories, especially pressure cookers. - Cookware and small appliances segments are growing fast; pressure cookers growing disproportionately to the industry. - Export business to grow over FY '26 levels, with new IKEA business starting meaningful revenue from FY '27 Q1. - Export growth currently subdued due to tariff-related pauses; optimism exists for stabilization and future growth. - Gross margins targeted to improve by about 1% year-on-year, aiming for 41-42% in next 3 years. - Capacity utilization for cast iron at 40-45%, with room for growth. - Operating cash flow remains healthy (INR ~240 crores for 9 months), supporting growth and debt reduction. - Price adjustments being implemented to offset commodity cost increases, supporting margin resilience.

- The company expects **double-digit revenue growth** in domestic business over the next 2-3 years, with annual growth likely above a 9-15% baseline. - **Gross margin guidance** targets improving from the current ~39% towards 41-42% over the next 3 years, implying margin expansion. - EBITDA margin is expected to improve by **at least 1% year-on-year**, supported by operational efficiencies and debt reduction. - Export growth for FY ’27 is forecasted to increase over FY ’26, aided by a new business stream from IKEA and normalization of existing export operations. - Operating Cash Flow stood at INR242 crores for 9 months FY ’26, indicating strong cash generation potential. - The company is confident about becoming **cash debt free by end of this quarter**, reducing interest expenses and supporting margin improvement. - Overall, while short-term export headwinds persist, strong domestic growth and new export contracts underpin positive earnings and EPS growth outlook.

- Stove Kraft has already secured orders for the whole year from IKEA. - Actual revenue from IKEA is expected to start from the first quarter of April FY '27. - Production for IKEA was initially expected to start in Q4 FY '26 but has been delayed by 3 months due to testing and approval delays. - The company is at the final stages of approvals from various labs, including those in China, with lab reports expected by March. - The BIS implementation for hobs has been deferred by 6 months; once implemented, Stove Kraft expects market share gains due to its in-house manufacturing capacity. - Other pending large-scale new business in exports has been affected by tariff uncertainties and delivery issues but is expected to stabilize and grow in FY '27.