Rice miller KRBL's shares fell over 9 percent in early trade on May 31, a day after the company posted its Q4 numbers. While the topline and the bottomline grew, the company's operating numbers declined sharply.
At 10:30am, the stock was quoting at Rs 367.50 on the NSE, lower by 8.9 percent. Trading volumes at 1.4 million shares, were 3.5 times the 20-day average volume.
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KRBL's revenue for the March quarter soared by 29.6 percent year-on-year to Rs 1,279.7 crore, and the net profit grew 8.2 percent to Rs 118 crore. However, the company's EBITDA margin dipped from 16.5 percent in the previous year to 11.2 percent in the current quarter. EBITDA at Rs 143.9 crore, declined 11.5 percent on-year.
"Margins were lower due to higher share of bulk non-basmati export sale (11 percent as against 7 percent of rice sales) where original contract was cancelled and goods had to be sold at lower realization in a different country," the company said in its investor presentation.
Basmati realisation grew by 17 percent compared to Q4 FY22, but it was offset by a corresponding 24 percent rise in rice input costs, the company added.
To allay investor concerns, KRBL said that India business is showing strong growth. In Q4, domestic business revenue came in at Rs 932 crore, driven by 18 percent growth in volume. Number of households consuming KRBL's India Gate brand crossed the milestone of 1 crore in March.
In an interaction with CNBC-TV18, chief financial officer of the company Ashish Jain informed exports are projected to be in excess of Rs 500 crore in Q1 FY24, similar to the level achieved in Q3. The Gujarat plant is set to commence operations in Q1, while the Karnataka plant might see a slight delay.
He anticipates margins to be restored in Q1 FY24, and the full-year margin for FY24 to be around 18 percent.
Over the past one year, KRBL shares have gained over 66 percent, outperforming its peers LT Foods and Kohinoor Foods. The stock is currently trading at a trailing price-to-earnings ratio of 12.142x.
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