RHI Magnesita India (534076) Q4 18/19 earnings summary

Executive summary

• FY19 revenue from operations reached Rs. 74,794.70 lacs; revenue excluding GST rose 19.33% YoY, while PBT increased 5.07% YoY to Rs. 13,748.28 lacs as reported in the operating review.

• Manufacturing and trading covered refractory products, monolithics and ceramic paper; annual refractory production capacity was nearly 50,000 tonnes.

• A final dividend of Rs. 2.50 per share was recommended, subject to shareholder approval.

Financial highlights

• Revenue from operations was Rs. 74,794.70 lacs vs. Rs. 63,722.73 lacs in FY18; the report separately cites 19.33% growth excluding GST, using a prior-year comparison of Rs. 62,678.77 lacs.

• Operating profit was Rs. 12,798.07 lacs vs. Rs. 12,704.99 lacs; PBT was Rs. 13,752.24 lacs vs. Rs. 13,084.53 lacs.

• Net income was Rs. 8,982.66 lacs vs. Rs. 8,583.32 lacs; total comprehensive income was Rs. 8,963.15 lacs vs. Rs. 8,568.89 lacs.

• Basic and diluted EPS were Rs. 7.48 each vs. Rs. 7.14; other income rose to Rs. 1,817.29 lacs from Rs. 1,062.23 lacs.

Outlook and guidance

• Indian Steel Association forecast steel demand growth of 7.1% in CY19 and 7.2% in CY20; domestic steel production was flat YoY at 27.4 Mt in Q4 FY19.

• The Indian refractory market was expected to grow 5–6%; the global market was projected to reach $48.6bn by 2023, at a 5.2% CAGR.

• Isostatic product capacity expanded from 9,300 to 11,700 tonnes/year in 2018; a hydraulic press for slide-gate refractory was expected to complete in Q3 FY20.

• Integration of the Indian entities was expected to conclude by mid-2019; the amalgamation scheme remained pending before the NCLT at the report date.