Ion Exchange (500214) Q3 24/25 earnings summary

Executive summary

• Consolidated Q3 FY25 operating income rose 24.7% year-over-year to INR 6,905 million, with EBITDA up 7% and net profit up 5%.

• Nine-month operating income increased 21.5% year-over-year to INR 19,026 million, with EBITDA up 16% and net profit up 18%.

• A leading provider of water, wastewater treatment, and environment solutions with a global footprint, operating 7 manufacturing and assembly facilities in India and several international locations.

• FY24 consolidated revenue mix: Engineering 60%, Chemicals 29%, Consumer Products 11%.

• Unaudited standalone and consolidated financial results for the quarter and nine months ended December 31, 2024, were approved by the Board on January 23, 2025.

Financial highlights

• Q3 FY25 consolidated PAT was INR 496 million (up 5.1% YoY); 9M FY25 PAT at INR 1,450 million (up 18% YoY).

• Q3 FY25 consolidated EBITDA margin at 10.92% (down 183 bps YoY); 9M FY25 at 10.93% (down 55 bps YoY).

• Diluted EPS for 9M FY25 was INR 12.185, up 17.2% YoY.

• Engineering division Q3 revenue grew 34% year-over-year to INR 4,301 million; chemical segment revenue up 6% to INR 1,993 million; consumer products revenue up 23% to INR 772 million.

• Consumer segment reported a loss of INR 29 million, higher than the previous year's INR 15 million loss.

Outlook and guidance

• Engineering division expected to grow 15%-20% in FY25, but margins will be about 1 percentage point lower than FY24 due to an onerous contract.

• Chemical segment targeting 10%-15% growth, with new Roha plant expected to contribute from Q2 FY26.

• Company-wide revenue growth guidance for FY25 is 15%-20%.

• Margins for FY25 expected to be slightly below FY24 levels, with improvement anticipated post-H1 FY26 as the onerous contract concludes.

• Engineering order book as of Dec 31, 2024, stood at ~INR 3,405 crore, with a bid pipeline of ~INR 8,648 crore.