Greenpanel Industries (GREENPANEL) Q2 24/25 earnings summary

Executive summary

• Domestic MDF volumes declined 4% year-on-year, with EBITDA margin at 13.1% impacted by competitive pricing and increased industry capacity.

• Plywood volumes rose 21% quarter-on-quarter but fell 10.4% year-on-year; EBITDA margin at 2.5% affected by low volumes and higher raw material costs.

• Export volumes dropped as management prioritized profitable orders amid higher ocean freight and wood prices; export realizations rose 24.4% year-on-year.

• Cash generated during Q2 FY25 was ₹63 crores; net debt stood at ₹97 crores as of September 30, 2024, including ₹228 crores for expansion.

• Unaudited financial results for the quarter and half year ended September 30, 2024, were reviewed and approved by the Board; statutory auditors found no material misstatements.

Financial highlights

• Q2 FY25 revenue from operations was ₹33,687.45 lakhs, down from ₹39,867.73 lakhs in Q2 FY24; net profit for Q2 FY25 was ₹1,850.40 lakhs, compared to ₹4,075.88 lakhs in Q2 FY24.

• Q2 FY25 gross margin was 48.6% (down from 55.5% YoY), EBITDA margin 11.9% (down from 18.4%), and net margin 5.6% (down from 10.3%).

• EPS for Q2 FY25 was ₹1.51, compared to ₹3.34 in Q2 FY24.

• Net working capital increased to 40 days in Q2 FY25 from 26 days YoY, mainly due to higher inventory and delayed exports.

• Net debt as of 30 September 2024 was ₹97 crores, including ₹228 crores for the new project.

Outlook and guidance

• Management targets 15–18% domestic volume growth year-on-year for H2 FY25, aiming for 10% full-year domestic growth.

• New MDF plant expected to reach 50% utilization in FY26 and 75–80% by FY27.

• No further price reductions planned; potential price increases considered for Q4 FY25 or December.

• CapEx of ₹80 crores pending, with phased spending over FY25 and FY26.

• Management remains hopeful of recovering outstanding government subsidies related to the Chittoor plant, which have not yet been recognized.