Premier Explosives Q4FY18 Concall Summary

The total revenue of the fourth quarter stood at INR 83.28 crores with a reported growth of 15 % from the corresponding quarter in last fiscal year
Operating profit of the quarter stood at INR 23 crores which was considerably higher than INR 14.02 crores in the last fiscal year
PBT which stood at INR 4.02 crores has slipped from INR 11.89 crores in the last quarter of last fiscal year
However total revenue in the whole year saw a jump of 15.5%
Consolidated Financial Results
- The total revenue of the group increased to INR 282.53 crores, outperforming their own estimates
- PBT and PAT was less than PBT and PAT in the last fiscal year

The costs of labor, power and other raw material has increased by little less than 5% while the selling price of the goods has decreased by 10% thus making it the single most largest factor for dipping margins
lso due to higher borrowing the cost of finance has increased by 25%

The QIP money and the preferential issue money would be mainly utilized as a Capex for raising new buildings

The company has decided to form a JV with next ammunitions
JV would equip them with the BMCS technology
For importing 30 mm technology a JV with PTL would be formed
Company would also add 40 mm to their technology base and they are anticipating to start trials on both the products by the month of August

In the fiscal that ended recently the total capex was INR 4.7 crores
The CWIP of the firm as of 31st March, 2018 was INR 15 crores
The upcoming projects such as one on Katepalli site would incur INR 50 crores of capex outlay
Capex would be on purchasing new machinery and raising new buildings
Company is hopeful of producing propellants in the current fiscal year in the new facilities
Company is expecting a total jump of 15-20% in the total turnover from the last fiscal year

A company named PELNEXT has been already formed and put up on the website as well
It is fully a venture project of Premier explosives and the partnering company has also asked France govt. for granting them permission to enter into this JV
Premiere explosives would retain 51% stakes in the JV while the foreign holding would remain at 49%

In defense category the major sellers would be propellants and chafs and flares
They have also developed a new product for the army, and being the only bidder of this product, they are hopeful of getting a huge order from the army
The defense products category may account for 50% of the total revenue in the next fiscal year

Company has received enquiry for products that are to be used in highly valuable missile systems of India namely, Pinaka, Brahmos, Astra and MRSAM
The insulation material offered by the company for the lining of motors has received a repeat order which is a positive sign for the