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HDFC Securities Report
Galaxy Surfactants Ltd.’s Q1 FY21 Ebitda/adjusted profit after tax was 74%/2.3 times higher than estimates, attributable to (1) 23% higher volumes and (2) 42% higher per-ton Ebitda.
Revenue declined merely by 8/9% QoQ/YoY to Rs 6 billion due to (1) only 11/5% QoQ/YoY decline in overall volumes, (2) 4/ down 4% QoQ/YoY growth in per-unit realisation.
Strong demand for performance surfactants (up 8% YoY) was offset by lower demand for speciality care products (down 26% YoY).
Increased awareness for hygiene, given Covid-19, led to a spike in volume offtake for the former; however, as discretionary spending reduced during the pandemic, the latter suffered a blow.
Despite a strong demand, labour shortage and lower production by customers (supply constraints) dragged overall volumes of the company.
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