IDBI Capital: Phillips Carbon Black - Volume And Margin Recovery Ahead
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IDBI Capital Report
Philip Carbon Black Ltd. reported better than expected Q2 FY21 results. Its sales/Ebitda were 4.5%/22.1% above our estimates.
Its volumes at 110 kilo tonne were a beat to our estimate and its Ebitda/tonne at Rs 9,482 was also above our forecast.
Phillips’ Ebitda fell 22.8% YoY to Rs 1,056 million mainly due to lower realizations. Nevertheless, its net debt fell to Rs 3,840 million from Rs 4,367 million as of March 2020.
We introduce FY23 estimates in this report. We have raised our FY21 sales volumes estimates slightly to account for Q2 FY21 volume beat.
We lower our FY21/FY22 interest expense to account for sharper than expected fall in debt in Q2 FY21.
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