Balkrishna Industries is down there currently among the top three losers on the BSE; the stock opened 2% lower at Rs.2276, going down 7% to its intraday low at Rs.2159. Its 10% LC is at Rs.2087.85.
The market has given the its Q1FY23 earnings a thumbs down. Higher raw material prices hurt the profits of the company.
Despite a 45% (YoY) rise in consolidated revenue, EBITDA fell 13% to Rs.444 crore with margins coming down sharply from 28% to 17%. Net profit was down 7% at Rs.307 crore.
Its raw material costs have come at 47% of sales v/s 42.8% in Q1FY22 and 45.3% in Q4FY22 and the company expects relief to come in only by Q4FY23.
It expects sluggish demand to continue in Q2 too given macro challenges in Europe coupled with Heatwaves and inflationary trends in USA.
Company has given a sales volume guidance for FY23 at 320,000 – 330,000 MT. It was at 83,153 MT in current Q1.