Eveready sees 10-15% revenue growth in FY15

Eveready Industries posted a stable set of earnings. Amritanshu Khaitan, Executive Director, Eveready India joins Sonia Shenoy, Menaka Doshi and Senthil Chengalvarayan on CNBC-TV18 to talk on the numbers.

Also read: Eveready hikes prices; hopes to post full-yr profit growth

Below is the verbatim transcript of the interview on CNBC-TV18:Q: Your 9 month revenues have grown by about 11 percent and your margins have grown for the first 9 months to 8.5 percent versus 6.8 percent earlier. Give us a sense of how you are expecting FY14 to end and also what growth you are expecting in FY15 considering that you have this new product offerings that have been on the ground for a while now. A: The numbers for 9 months have highlighted a significant margin expansion for the company and this has happened due to the substantial price increases the company took in the month of May as well as in October. With the rupee depreciation being over 10 percent we have been able to keep the margins stable. We should end the year with an EBITDA margin of around 8 percent with Q4 of the company being a lean quarter. Going forward into next financial year we are very confident to keep growing the company's topline by 10-15 percent again next year and EBITDA expansion should also take place.Q: Will there be anymore price hikes that the company will have to take in order to pass on the higher input costs or are we pretty much done for now?A: We could look at another round of price increase before our season starts in the month of May. However, that depends on how the rupee behaves in the coming months. This price increase would actually be taken to cushion profitability going forward as the rupee depreciation according to all indications will take place.Q: The last time we spoke with you, you had indicated that you have entered into some new products like power backups for mobile phones, rechargeable fans etc. Just wanted to know how those products are doing and also what kind of revenue growth potential that has in the next fiscal year?A: Our core business is batteries and flash lights. The area where we are seeing significant growth is the overall lighting and electrical category. This quarter alone our turnover in the category has grown by over 40 percent. We see next year the growth to increase to between 50-60 percent due to the distribution expansion taking place to sell these products. To answer your question all the new products should add overall growth in the lighting category by 50 percent but if you see the total company topline these new products should add about additional 5 percent turnover to this year’s Rs 1100 crore odd.Q: Your interest costs have come down this time around. You mentioned that you will be reducing borrowings further to bring down interest costs. What kind of average run rate are you working with or guiding for?A: We have reduced the borrowing of the company from around Rs 280 crore March 2013 to Rs 220 crore as we speak. The current year our total interest cost is expected to be around Rs 38-40 crore. So, the real benefit of the debt repayment we should see next year where the interest cost should drop from Rs 40 crore to around Rs 25-28 crore. This will enable the company to guide for comfortably doubling the PBT numbers in FY14-15.