Particulars (Rs. in Crores) | Q2FY22 | Q2FY21 | YoY | Q1FY22 | QoQ |
---|---|---|---|---|---|
Net Revenue from Operations | 362.80 | 236.80 | 53.21% | 214.20 | 69.37% |
EBIT | 35.80 | 31.80 | 12.58% | 16.10 | 122.36% |
EBIT Margin | 9.87% | 13.43% | 7.52% | ||
PAT | 22.90 | 26.90 | -14.87% | 13.50 | 69.63% |
PAT Margin | 6.31% | 11.36% | 6.30% | ||
EPS | 6.93 | 10.87 | -36.25% | 4.09 | 69.44% |
Source: Company Filings; StockAxis Research
Quarterly Result Update
Stove Kraft Limited (SKL) reported strong Q2FY22 numbers whereby revenue increased
by 53% YoY to Rs 362 crores driven by growth across all channels – general
trade, modern retail and e-commerce. Ebitda was up ~15% YoY however margins were
down by ~360 bps 11.2% due to higher raw material costs. PAT was down by ~15% YoY
to Rs 23 crores as the company has started providing for income tax after setting
off accumulated losses brought forward from previous years. During the quarter,
the Company introduced Distributor Management System across 100% of its outlets.
This tool helps improve operations and provide effective sales & inventory management
related only to Pigeon products. The Company has also focused on backward integration
of the facilities which will help in reducing costs and improving efficiencies.
SKL added 8,247 retail outlets in the quarter gone by. In Q2FY22, Pressure Cooker
volume grew by 53% YoY, Gas Cooktop by 31% YoY, Induction Cooktop by 53% YoY, Non-stick
Cookware by 14% YoY, LED by 70% YoY and Small Appliances/Mixer/Others grew by 34%
YoY.
Strong distribution network and spending on advertising & marketing to aid
revenue growth
SKL added 8,247 retail outlets in Q2FY22 taking the total number to 63,428 outlets
as of September 2021. The company is focused on increasing distribution network
across the country and bringing more customers onboard through increasing the number
of retail outlets. During the quarter, the company increased spending on branding
& marketing through focused and consistent initiatives to develop brand awareness.
We believe these initiatives will help the company to deliver consistent growth
going forward.
Key Con-call highlights:
We believe the company has taken the right steps towards delivering sustainable growth. It is well placed to reap the benefits of having a strong presence in Tier-2 and Tier-3 cities and is working to establish its presence in Tier-1 cities too. Focus on expanding distribution network will be the key growth driver. Based on our estimates, the stock is currently trading at ~24x FY23 EPS and we maintain Hold rating for the company.
Particulars (Rs. in Crores) | Q2FY22 | Q2FY21 | YoY | Q1FY22 | QoQ |
---|---|---|---|---|---|
Revenue from Operations | 362.80 | 236.80 | 53.21% | 214.20 | 69.37% |
COGS | 246.00 | 153.40 | 140.80 | ||
Gross Profit | 116.80 | 83.40 | 40.05% | 73.40 | 59.13% |
Gross Margin (%) | 32.19% | 35.22% | 34.27% | ||
Employee Benefit Expenses | 30.30 | 20.30 | 23.80 | ||
Other Expenses | 45.90 | 27.90 | 29.40 | ||
EBITDA | 40.60 | 35.20 | 15.34% | 20.20 | 100.99% |
EBITDA Margin (%) | 11.19% | 14.86% | 9.43% | ||
Depreciation | 4.80 | 3.40 | 4.10 | ||
EBIT | 35.80 | 31.80 | 12.58% | 16.10 | 122.36% |
EBIT Margin (%) | 9.87% | 13.43% | 7.52% | ||
Finance Cost | 3.90 | 5.40 | 3.00 | ||
Oher Income | 0.10 | 0.50 | 0.40 | ||
Profit Before Exceptional Items & Tax | 32.00 | 26.90 | 13.50 | ||
Exceptional Items | - | - | - | ||
Profit Before Tax | 32.00 | 26.90 | 18.96% | 13.50 | 137.04% |
Tax | 9.10 | - | - | ||
Effective Tax Rate (%) | 28.44% | 0.00% | 0.00% | ||
Profit After Tax | 22.90 | 26.90 | -14.87% | 13.50 | 69.63% |
PAT Margin (%) | 6.31% | 11.36% | 6.30% | ||
Other Comprehensive Income | -0.30 | 1.30 | -0.20 | ||
Total Comprehensive Income | 22.60 | 28.20 | 13.30 | ||
Earnings Per Share (Rs.) | 6.93 | 10.87 | -36.25% | 4.09 | 69.44% |
Source: Company Filings; StockAxis Research
Yr End March (Rs Cr) | 2019 | 2020 | 2021 | 2022E | 2023E |
---|---|---|---|---|---|
Net Sales | 640.90 | 669.90 | 859.00 | 1154.00 | 1419.40 |
Growth % | 22.40% | 4.50% | 28.20% | 34.30% | 23.00% |
Expenditure | |||||
Material Cost | 438.70 | 441.90 | 558.20 | 763.90 | 922.60 |
Employee Cost | 68.60 | 82.00 | 80.60 | 108.50 | 134.80 |
Other Expenses | 103.80 | 112.20 | 106.60 | 152.30 | 181.70 |
EBITDA | 29.80 | 33.80 | 113.50 | 129.20 | 180.30 |
Growth % | 199.10% | 13.30% | 235.70% | 13.90% | 39.50% |
EBITDA Margin | 4.70% | 5.00% | 13.20% | 11.20% | 12.70% |
Depreciation & Amortization | 12.40 | 12.40 | 14.30 | 17.30 | 20.70 |
EBIT | 17.40 | 21.40 | 99.20 | 112.00 | 159.60 |
EBIT Margin % | 2.70% | 3.20% | 11.50% | 9.70% | 11.20% |
Other Income | 1.70 | 3.10 | 1.50 | 5.00 | 10.00 |
Interest & Finance Charges | 17.90 | 20.90 | 19.20 | 2.50 | 1.70 |
Profit Before Tax - Before Exceptional | 1.10 | 3.50 | 81.50 | 114.50 | 167.90 |
Profit Before Tax | 1.10 | 3.50 | 81.50 | 114.50 | 167.90 |
Tax Expense | 0.50 | 0.40 | - | 16.00 | 42.00 |
Effective Tax rate | 43.50% | 10.30% | 0.00% | 14.00% | 25.00% |
Exceptional Items | - | - | - | - | - |
Net Profit | 0.60 | 3.20 | 81.50 | 98.50 | 125.90 |
Growth % | -105.00% | 399.40% | 2468.80% | 20.90% | 27.90% |
Net Profit Margin | 0.10% | 0.50% | 9.50% | 8.50% | 8.90% |
Consolidated Net Profit | 0.60 | 3.20 | 81.50 | 98.50 | 125.90 |
Growth % | -105.00% | 397.80% | 2476.90% | 20.90% | 27.90% |
Net Profit Margin after MI | 0.10% | 0.50% | 9.50% | 8.50% | 8.90% |
Yr End March (Rs Cr) | 2019 | 2020 | 2021 | 2022E | 2023E |
---|---|---|---|---|---|
Share Capital | 24.70 | 24.70 | 32.60 | 32.60 | 32.60 |
Total Reserves | -87.30 | -85.80 | 267.10 | 365.60 | 491.60 |
Shareholders' Funds | -62.40 | -60.00 | 301.40 | 399.90 | 525.90 |
Minority Interest | 0.20 | 0.20 | - | - | - |
Non Current Liabilities | |||||
Long Term Burrowing | 210.00 | 204.80 | 20.70 | 0.20 | -4.80 |
Deferred Tax Assets / Liabilities | - | - | - | - | - |
Long Term Provisions | 4.60 | 6.30 | 7.20 | 5.00 | 4.90 |
Current Liabilities | |||||
Short Term Borrowings | 99.90 | 122.10 | 29.80 | 29.80 | 29.80 |
Trade Payables | 134.10 | 150.90 | 176.60 | 198.50 | 253.80 |
Other Current Liabilities | 29.20 | 34.30 | 14.80 | 10.00 | 10.00 |
Short Term Provisions | 2.00 | 2.00 | 2.20 | 2.20 | 2.20 |
Total Equity & Liabilities | 427.10 | 471.30 | 569.70 | 662.80 | 838.90 |
Assets | |||||
Net Block | 180.50 | 193.20 | 219.60 | 266.90 | 300.20 |
Non Current Investments | - | - | - | - | - |
Long Term Loans & Advances | 6.70 | 8.60 | 14.80 | 16.00 | 16.00 |
Current Assets | |||||
Currents Investments | - | - | - | - | - |
Inventories | 97.40 | 116.60 | 156.00 | 157.20 | 197.40 |
Sundry Debtors | 89.70 | 103.00 | 84.70 | 110.30 | 141.00 |
Cash and Bank | 31.50 | 19.40 | 37.30 | 53.40 | 125.50 |
Short Term Loans and Advances | 7.50 | 13.90 | 34.00 | 34.40 | 34.30 |
Total Assets | 427.10 | 471.30 | 569.70 | 662.80 | 838.90 |
Yr End March (Rs Cr) | 2019 | 2020 | 2021 | 2022E | 2023E |
---|---|---|---|---|---|
Profit After Tax | 0.60 | 3.20 | 81.50 | 98.50 | 125.90 |
Depreciation | 12.40 | 12.40 | 14.30 | 17.30 | 20.70 |
Changes in Working Capital | -18.00 | -27.50 | -8.10 | -4.80 | -15.70 |
Cash From Operating Activities | 13.20 | 15.60 | 110.00 | 110.90 | 131.00 |
Purchase of Fixed Assets | -7.40 | -26.10 | -63.40 | -64.60 | -53.90 |
Free Cash Flows | 5.70 | -10.50 | 46.60 | 46.40 | 77.10 |
Cash Flow from Investing Activities | -6.80 | -27.30 | -66.40 | -64.60 | -53.90 |
Increase / (Decrease) in Loan Funds | 40.30 | 16.30 | -100.80 | -22.40 | -5.00 |
Equity Dividend Paid | - | - | - | - | - |
Cash from Financing Activities | 21.80 | -1.80 | -29.10 | -22.40 | -5.00 |
Net Cash Inflow / Outflow | 28.10 | -13.50 | 14.40 | 24.00 | 72.10 |
Opening Cash & Cash Equivalents | 0.40 | 28.50 | 15.00 | 29.50 | 53.40 |
Closing Cash & Cash Equivalent | 28.50 | 15.00 | 29.50 | 53.40 | 125.50 |
Yr End March | 2019 | 2020 | 2021 | 2022E | 2023E |
---|---|---|---|---|---|
Basic EPS | 0.30 | 1.30 | 24.90 | 30.00 | 38.40 |
Diluted EPS | 0.30 | 1.30 | 24.90 | 30.00 | 38.40 |
Cash EPS (Rs) | 5.30 | 6.40 | 29.20 | 35.30 | 44.70 |
DPS | - | - | - | - | - |
Book value (Rs/share) | -25.20 | -24.60 | 92.00 | 122.00 | 160.40 |
ROCE (%) Post Tax | 4.70% | 8.50% | 32.50% | 25.70% | 25.90% |
ROE (%) | -1.00% | -5.30% | 27.00% | 24.60% | 23.90% |
Inventory Days | 57.70 | 58.30 | 57.90 | 57.00 | 56.00 |
Receivable Days | 48.20 | 52.50 | 39.90 | 40.00 | 40.00 |
Payable Days | 79.50 | 77.70 | 69.60 | 72.00 | 72.00 |
PE | 1783.70 | 358.30 | 18.30 | 30.40 | 23.80 |
P/BV | -18.20 | -18.60 | 5.00 | 7.50 | 5.70 |
EV/EBITDA | 47.70 | 42.50 | 13.40 | 23.00 | 16.10 |
Dividend Yield (%) | 0.00% | 0.00% | 0.00% | 0.00% | 0.00% |
P/Sales | 1.80 | 1.70 | 1.70 | 2.60 | 2.10 |
Net debt/Equity | - | - | 0.00 | - | - |
Net Debt/ EBITDA | 9.70 | 9.40 | 0.10 | -0.20 | -0.60 |
Sales/Net FA (x) | 3.50 | 3.60 | 4.20 | 4.70 | 5.00 |