Suprajit Engineering Limited
7,698words
110turns
4analyst exchanges
5executives
Management on call
Ajith Kumar Rai
CHAIRMAN, SUPRAJIT ENGINEERING LIMITED
Mohan
MD AND GROUP CEO, SUPRAJIT ENGINEERING LIMITED
Akhilesh Rai
DIRECTOR AND CHIEF STRATEGY OFFICER, SUPRAJIT ENGINEERING LIMITED
Medappa Gowda
CFO AND COMPANY
Vijay Sarathi
ANAND RATHI SHARE AND SECRETARY, SUPRAJIT ENGINEERING LIMITED STOCK BROKERS LIMITED
Key numbers — 36 extracted
rs,
INR 645 crore
INR 362 crore
78%
INR 57 crore
INR 49 crore
15%
INR 486 crore
34%
INR 64 crore
30%
INR 337 crore
Guidance — 20 items
N S Mohan
opening
“As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes.”
N S Mohan
opening
“Our Narsapura plant has been commercialized and the customer audits have been completed, our electronic SMP line and the assembly lines for electronic instrument clusters are in place, trial production is on, we will be commercializing it in September, but having said that we have already started deliveries to some of the customers with the outsourced boards.”
N S Mohan
opening
“With one of the major OLMs or other label manufacturers as we call it, we are in discussion and we expect that to be concluded shortly.”
Akhilesh Rai
opening
“Regarding the max team integration project of LDC, you know, this integration project is very different from what we had done with Westcon, which was generally a standalone entity, our max teams have been working very hard and I'm confident that they will deliver the kind of synergies we need in all departments.”
Akhilesh Rai
opening
“Suprajit Engineering Limited August 12, 2022 The [inaudible] 11:25 Team is really working on moving the LDC, ERP and SAP to the Suprajit environment and taking the necessary knowledge transfers to support LDC in the long, this was obviously support it by KA as a parent, and now we will be supporting it going forward from India.”
Ajith Kumar Rai
opening
“Just to give the clarity to the investors, we will be declaring during the course of this year standalone, consolidated excluding LDC and consolidating including LDC and a separate note on LDC performance quarter and every quarter for the next three quarters and next year, as Mohan said this entire integration will evolve into a domestic cable division as DCD and an SCD, Suprajit Cables Division, which is our global business, which is headed by Jim Ryan.”
Ajith Kumar Rai
opening
“So that's how the next year's numbers will pan out.”
Ajith Kumar Rai
qa
“So that will take some time because as you know, Mohan just mentioned that for now international OEM customers, it took almost 10 to 12 months to get a price increase, however, we expect it to be not that long for this case, it'll probably be earlier because they have already given the price increases for other suppliers, but still it is there is a lag effect on that, so that's number one.”
Ajith Kumar Rai
qa
“We are all cable people and Jim is one of the fantastic cable guy we can find in the world, along with him and our team here, in fact, I visited some of those plants recently, I'm fully confident that it's just a question of time and the first year may have this disturbances but I think given that time I'm pretty sure things will be what we said in the beginning itself.”
Ajith Kumar Rai
qa
“I'm not saying that we won't meet our guidance of 14 to 16%, even if we missed maybe a hundred basis point a year or so, it is more a, I would say precautionary thing, we are still aiming to do what we have done.”
Risks & concerns — 11 flagged
Moving over to PLD or the Phoenix lamps division the revenue has showed reasonable upward tick but as you would've noticed, the margins continue to be under pressure, here it has taken us some time to get the price increases from the OEM.
— N S Mohan
Moving over to the overseas portion of PLD that is Trifa and Luxlite, it continues to be a challenge and we are working on measures to address this area.
— N S Mohan
I think the key challenges like Mohan has said is the price increases not being passed on to customers by the previous management, I think the lockdown in Shanghai was a significant drag and the deterioration of the Euro for our Hungarian operation where lot of the purchasing is done in Euros and that was also a drag.
— Akhilesh Rai
You know, the impact of material costs happened in 2021.
— Ajith Kumar Rai
I mean, we have also gone to the customers and got the price increases, which they have not done, so that is what is the major challenge we have.
— Ajith Kumar Rai
Deferred taxes are a very difficult calculation, the auditors do it, and we just announce it.
— Ajith Kumar Rai
I think on the LDC business on individual units and their margins and how it impacted it is little difficult for us to present it because there's so many levers in that.
— Ajith Kumar Rai
How much impact of the lockdown in China plant?
— Abhishek Kumar Jain
So just wanted to understand what are the key regions and what is the impact of each one like that lower export on the unit 9 and labor availability issues from the Wichita and Juarez plan and one offs, so can you quantify more terms of?
— Abhishek Kumar Jain
One is availability of manpower also in the US, for eg, you know, US unemployment rate is one of the lowest today, particularly to people to get to do work in the shop floor is a big challenge.
— Ajith Kumar Rai
Like if there would be a price increase in Q1, Q2, anything that'd we expect because it seems like the margin is still under stress for the next quarter.
— Vignesh Iyer
Q&A — 4 exchanges
Speaking time
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Opening remarks
N S Mohan
Good morning, ladies and gentlemen, welcome to the Q1 FY23 Investor Analyst Conference Call for Suprajit Engineering Limited hosted by Anand Rathi Shares and Stock Brokers. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the Conference Call, please signal an operator by pressing “*” then “0” on your touch tone phone, please note that this conference is being recorded. I now hand the conference over to Mr. Vijay Sarathi from Anand Rathi Shares and Stock Brokers. Thank you and over to you, sir. Thanks, Lizann. On behalf of Anand Rathi I welcome you all to the first quarter 23 Conference Call of Suprajit Engineering. From the management side, we have Mr. Ajith Kumar Rai, the chairman, Mr. Mohan, MD and group CEO, Mr. Akhilesh Rai, the director and chief strategy officer and Mr. Medappa Gowda, CFO and Company Secretary. We will start with the in
Akhilesh Rai
Yes, sure. So, you know, of course this is in addition to the comprehensive disclosure on LDC on 25th of July that was made. I think the key challenges like Mohan has said is the price increases not being passed on to customers by the previous management, I think the lockdown in Shanghai was a significant drag and the deterioration of the Euro for our Hungarian operation where lot of the purchasing is done in Euros and that was also a drag. Regarding the max team integration project of LDC, you know, this integration project is very different from what we had done with Westcon, which was generally a standalone entity, our max teams have been working very hard and I'm confident that they will deliver the kind of synergies we need in all departments. Just to give you a few examples, you know, our sales max team are completely focused right now on approaching customers to get, you know, some of the price increases needed to pass on these inflationary costs. I'm happy that our Purchasing M
Ajith Kumar Rai
Yes. Good morning, everyone. We announced the quarterly financial results for June 2022 yesterday. The consolidated revenue including LDC for the quarter ended June 2022 was INR 645 crore as against INR 362 crore for the last year with a growth of 78%. The consolidated operational EBITDA for the quarter ended, 30th June 2022 was INR 57 crore as against INR 49 crore last year recording a growth of 15%. The consolidated revenue excluding LDC for the quarter ended June 2022 was INR 486 crore as against INR 362 crore with a growth of 34%. The consolidated operational EBITDA for the quarter ended 30th June, 2022 was INR 64 crore as against INR 49 crore with the growth of 30%. The standalone revenue for the quarter ended 30th June, 2022 was INR 337 crore against INR 209 crore last year with the growth of 61%. The standalone operational EBITDA for the quarter ended 30th June, 2022 was INR 51 crore against INR 32 crore of last year recording growth of 61%. The overall debt level was INR 537 cr