- 15 May 2023
- ICICI Securities
Astral Q4 Results 2023: Strong performance led by EBITDA margin expansion
Astral Ltd | CMP: 2417 | Market Cap: 64,920.43
Strong performance led by EBITDA margin expansion
Q4FY23 Earnings Summary
View: We believe Astral has reported a healthy performance in Q4FY23 led by EBITDA margin expansion. We believe, the EBITDA margin expansion is largely due to benefit of use of low-cost inventories and amid sharp fall in PVC prices (down 32% YoY). However, the higher employee costs and other expenses (up by 120 bps and ~100 bps YoY respectively) have restricted overall EBITDA margin expansion. On the volume front, we believe pick up in construction activities and launch of new products segment have helped drive overall volume growth of plumbing products in Q4FY23. Going forward we believe, the company will continue to report a volume led revenue growth supported by new product launches and capacity additions in new geographies. However, We believe the EBITDA margin to normalise in the coming quarters subsiding impact of inventory gains. We await management commentary on company’s future demand outlook and EBITDA margin movement going forward.
Impact: Positive