Navin Fluorine Q3FY17 Concall Summary

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   Financial Highlights:

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  • Q3FY17 revenues are up by 6% from Q3FY16 at Rs. 154 Crores. Year to date performance has also been on the upside with a revenue of Rs. 501 Crores, up by 12% from the previous year
  • Operating EBITDA is up by 32% to Rs. 30 Crores for Q3FY17 as margins soared by 315 basis points to currently at 19.7%
  • Operating PBT is also up by 52% from the Q3FY16 numbers as NFIL registered PBT of Rs. 24 Crores
  • NFIL registered a net Profit of 21 Crores which is an increase of 52% over Q3FY16 with Net Profit margins at 13.4% (up by 403 basis points from previous year same quarter results)
  • YTD performance has also improved as EBITDA margins are up by 414 basis points to 22.1% for the nine months in 2017
  • Operating PBT for 9-months in FY17 is at Rs. 93 Crores (Rs. 63 Crores during same period last year) and PAT for 9-months in FY17 has touched Rs. 105 Crores (90% growth from last year)
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CRAMS Business

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  • Considerable increase in revenues from this nosiness unit as revenues for this 9-month period in FY 17 has touched Rs. 92 Crores surpassing the last annual figure of 87 Crores
  •  Strong Foothold in European and American markets have been essential for the growth
  • New manufacturing and research setups at Dewas and Dahej are going as per company’s expectations
  • Plants at Surat and Dewas have received certification from National Safety Council for health, safety and environment related practices
  • Dahej plant is expected to start operating from next quarter after the approvals from USFDA and EU. The plant is expected to operate at 100% capacity from FY2019 with an asset turnover ratio of 1:1. Total Capex estimated is Rs. 140 Crores
  • Contract Research Plant at Dewas is also expected to ramp up operations from in 2-3 years with an asset turnover ratio of 2-2.5. Total Capex estimated is 100 Crores
  • Dahej Plant is going to take in inorganic fluorides from the company’s business unit as raw materials which will also be a driving factor for NFIL’s Fluoride business

Specialty Chemicals Business

  • This business unit has posted a revenue of 162 crores in nine-month period in FY17 (20% Y-o-Y growth)
  • This section of business has been facing headwinds from the domestic Pharma and international agro-chemical market players in terms of pricing and volumes
  • On the agro-chemicals side, clients are in a cautious state of terms as they don’t want to commit any orders
  • On the domestic pharma side, new routes are causing headwinds for this business unit

Refrigerant Gas Business

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  • Revenue from this business segment has reached Rs 156 Crores for the nine-month period in FY17, almost same as last year’s figures
  • Refrigerant gases Bu has been contributing 31% of overall sales out of which exports contributed 30%
  • The business unit has posted mediocre quarter numbers due to seasonality of revenues in this quarter and is expected to grow in the coming quarter due to increase in sales of refrigerant and ACs in Gulf and domestic market

Inorganic Fluorides Business

  • Inorganic Fluorides Bu has contributed a revenue of Rs. 82 Crores for the nine-month period in FY17 which is 23% higher than the last year’s figures for the same period
  • Demonetization in this quarter have impacted the volume figures for this business unit as the distributors were unable to sell their stocks to retailers  
  • The business unit contributed about 17% of the topline of the company as 93% sales came from domestic market
  • Growth in the current contribution margins is expected for the following quarters
  • Intermediates for specialty chemicals at Dahej plant will be supplied by this business unit but the final figures of the supply cannot be estimated at this juncture
  • NFIL is expecting major demand drivers from steel industry, pharma and agro industry in both domestic and foreign markets (Europe, Gulf and America) in the future for this business

Other Updates

  • Project with Honeywell will start operating from the next quarter which is currently at a pilot stage now. Though pricing formula cannot be estimated at this point of time.
  • No other Capex apart from Current plants at Dewas and Dahej is scheduled as NFIL is looking forward to realization of these assets in the forth-coming quarters
  • Raw material prices have stabilized for this quarter as they have no correlation with crude prices