Asahi India Q4 Review - Operating Leverage, Product Mix Aid Margins: ICICI Securities

Automotive safety glass repair and replacement by Asahi India Glass Ltd. (Source: Company website).

Asahi India Q4 Review - Operating Leverage, Product Mix Aid Margins: ICICI Securities

BQ Blue’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 BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

Asahi India Glass Ltd.’s Q4 FY21 operating numbers were a beat on consensus estimates as revenue rose 36% YoY to Rs 8 billion while Ebitda margin came in at 22.7% (up 703 basis points YoY).

Faster growth in architectural segment (up 46% YoY) has led to superior mix (contribution rose to 42.4%/ up 300 basis points), thus aiding margins.

We remain positive on the stock due to-

1. strong proxy play for domestic passenger vehicle recovery coupled with headroom for content increase;

2. play on architectural segment demand growth on the back of improving housing demand and

3. leaner fixed-cost structure vis-a-vis competition (domestic/imports) aided by policy support (e.g. anti-dumping duty).

Click on the attachment to read the full report:

ICICI Securities Asahi Q4FY21 Results Update.pdf

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