VST Industries Q4 Review - Muted Demand, Elevated Packing & Raw Material Prices Cut Margin: Centrum Broking

"NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Centrum Broking Report.VST Industries Ltd. Q4 FY24 print was above our estimates; on a weak base revenues/Ebitda/profit after tax grew at 24.4%/ 17.8%/28.4% and higher leaf tobacco exports (30% revenue contribution Versus 15% in FY23). Despite weak Q4 FY23 (-11%), cigarette volumes remained flat YoY due to muted rural demand and weaker RSFT portfolio, yet leaf tobacco exports grew 30%.Higher prices of leaf tobacco and packaging (filter rod) resulted cut in gross margins to 48.2% 458 basis points YoY. With higher employee/other expenses at 13.5%/6.3% Ebitda margins cut to 25.6% (-142 bp). VST Industries saw elevated raw material/packing material prices in Q4 as well, yet it expects some relief through rationalizing cost structure..VST Industries expects gradual recovery in demand to be led by,focus on core markets - Uttar pradesh/West Bengal/Bihar/Andhra Pradesh/Telangana (~65% of sales) to improve volumes,launched Demislim Edition-Trio priced at Rs 10 in the RSFT segment,expects rural markets to bounce back, andstable taxation.With better than expected FY24 we tweaked earnings and downgrade to 'Add' with a revised discounted cash flow-based target price Rs 4,280 implying 16.0 times FY26E earning per share..Click on the attachment to read the full report:.Gillette India Q3 Results Results - Inline, Top-Line Momentum Back To Double Digits: Nirmal Bang.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner."

VST Industries Q4 Review - Muted Demand, Elevated Packing & Raw Material Prices Cut Margin: Centrum Broking

Sharp erosion in gross/Ebitda margins to 48.2%/25.6% led by change in product mix

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VST Industries Q4 Review - Muted Demand, Elevated Packing & Raw Material Prices Cut Margin: Centrum Broking

Sharp erosion in gross/Ebitda margins to 48.2%/25.6% led by change in product mix

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