Meghmani Finechem Limited (MFL), an integrated chemical manufacturer, has announced its financial results for the quarter and year ended March 31st, 2023. The company delivered a strong operating and financial performance. For FY23, the chemical major posted a 40% jump in PAT at Rs 353 cr as against Rs 253 cr in FY22. Revenue for the year ended March 31, 2023 rose by 41% to Rs 2,188 cr as compared to Rs 1,551 cr in FY22.
As per Maulik Patel, Chairman and Managing Director, MFL, FY 2022-23 was a very exciting year, despite business undergoing a lot of volatility, realisations were at their peak at the start of the year and dropped sharply by the end of the year. Their strategy to diversify in high value new products and continuous expansion has brought them volume growth of 15 per cent YoY and 13 per cent QoQ. Revenue contribution from derivatives and specialty chemical segment touched 38 per cent in Q4FY23, the company aims to further enhance​ ​​​its revenue share from this segment.
The new expansions that got commissioned in FY23, contributed marginally in FY23, however in the current fiscal (FY24) a sizable volume growth is expected from these commissioned plants. Further expansions that MFL is currently working on in FY24 will drive growth for FY25. Through continuous expansion and strengthening its integrated complex, MFL is geared to bring consistent growth to business, shares Patel.
The key performance highlights are:
Strategic update for FY 2022-23:
- Following expansion projects are moving as per schedule
- CPVC Resin – Additional capacity of 45,000 TPA, expected to get commission by Q4FY24
- Chlorotoluene & its value chain, expected to get commission by Q4FY24
- R&D centre near Ahmedabad, expected to ready by Q2FY24
- MFL entered in JV to set up 18.34 MW hybrid power plant to meet energy requirement at the plant
- MFL acquired 2,89,844.41 sq. m. land in Dahej (close to current complex) for future growth plans
- In FY23, MFL commissioned Epichlorohydrin on 1st June 2022, CPVC on 18th July 2022 and additional capacity of caustic soda on 30th September 2022 which were all completed within their committed timelines and capex limit. These projects contributed volume marginally in FY23 and expected to contribute fully in FY24
- MFL spent Rs 416 cr on capex in FY23 vs Rs 456 cr in FY22
FY 2022-23 financial highlights:
- Revenue from operations rose 41 per cent to Rs 2,188 cr as against Rs 1,551 cr in FY22 on account of higher realisation compared to last year and volume growth from existing products as well as new products
- Revenue contribution from derivatives and specialty chemical segment increased to 30 per cent in FY23 vs 25 per cent in FY22
- EBITDA grew 35 per cent to Rs 689 cr. Margin stood at 31 per cent (33 per cent FY22) on account of high cost of inventory compared to realisation
- PAT grew 40 per cent to Rs 353 cr as against Rs 253 cr in FY22 and PAT margin stood at 16 per cent (16 per cent in FY22)
- Net Debt/ EBITDA stood at 1.3x (1.9x in FY22). Net debt/equity stood at 0.8x (1.3x in FY22).
- Total debt decreased by Rs 112 cr to Rs 877 cr (Rs 989 cr in FY22)
Q4FY23 operational highlights (YoY):
- Volume growth of 15 per cent YoY (13 per cent QoQ) – Led by new product CPVC Resin and Epichlorohydrin contributed and growth in volume of caustic soda and hydrogen peroxide
- Capacity utilisation of hydrogen peroxide reached 98 per cent and CMS reached 102 per cent
- Realisation – caustic soda dropped by 23 per cent, chloromethanes dropped by 13 per cent and hydrogen peroxide increased by 1 per cent
Q4FY23 financial highlights (YoY):
- Revenue grew 13 per cent to Rs 562 cr as compared to Rs 499 cr in Q4FY22 on account of volume growth of 15 pe cent
- Revenue contribution from derivatives and specialty chemical segment increased to 38 per cent in Q4FY23 vs 19 per cent in Q4FY22
- PAT stood at Rs 77 cr as against Rs 99 cr in Q4FY22