Margins likely to stay in 10-11% range:Transformers & Rectifiers

Transformers & Rectifiers (India) Ltd (TRIL) reported 88 percent increase in the revenue in the second quarter of this fiscal. In an interview with CNBC-TV18, Jitendra Mamtora, Chairman, Transformers and Rectifiers India said topline can be between 800-900 crore and earnings before interest, tax and amortization (EBITDA) will remain in the range of 10-11 percent for the year.He said government announcement of investing more than one lakh crore of rupees in transmission sector to take care of the surge in the generation of electricity mainly solar and wind, will give the entire industry a big boost.Talking about his order book, Mamtora said as on November 1, it was Rs 950 crore. More than about Rs 120 crore order is in the pipeline.Below is the verbatim transcript of Jitendra Mamtora's interview to Reema Tendulkar and Prashant Nair on CNBC-TV18.Reema: Can you tell us what would be your full year revenue guidance after this kind of a Q2 performance and you reported a profit at the bottomline of this quarter, does it mean that you are likely to end FY16 with gains?A: Yes and the topline can be anywhere between 800 and 900 at the end of the year.Reema: On the bottomline, what would be the profits that you anticipate?A: EBITDA margin will remain in this range, 10-11 percent.Prashant: 10-11 percent for the year?A: Yes.Prashant: What are the dominant factors at play as far as your business is concerned right now? Incrementally what is changing, could you give us some colour?A: It is good order booking and there are more enquiries, more tenders, more winning of the tenders by us, everywhere. The stocks of majority of the transformer manufacturers are going up is a positive sign and besides the government announcement of investing more than a lakh crore of rupees in transmission to take care of the surge in the generation of electricity mainly into solar and wind. That will give the entire industry which is catering to the transmission sector a big boost.Reema: What is your order book? When we last spoke to you, it was around Rs 868 crore?A: As on November 1, it is Rs 950 crore, more than about Rs 120 crore order in the pipeline which are already decided. We are just awaiting the approval.Prashant: What was EBITDA margin in financial year 2016?A: That was about 6 percent.Prashant: And you are saying 10-11 percent this year?A: Yes.Prashant: Commodity prices generally have been far lower, far depressed last year compared to this year, we have seen comebacks in most commodities across the board. You are saying that your margins would be double of what they were last year?A: The commodity prices do not impact our business in the sense that these prices are all variable prices. So if the commodity prices go up, we get higher rate. If the commodity prices go down, we get lower rate.Prashant: 100 percent is variable?A: Yes barring few orders, which are short delivery orders but all the long delivery orders are based on the price variation.