In an exclusive interview with Meena Konar of Myiris.com, Sunil Kanojia, Group President of Sintex Industries (Q,N,C,F)* says, "We are looking at good growth in margins as utilizations improve."
1. How do you see overall industry outlook for Sintex Industries?
We are looking at a consolidated growth of 25-30% for FY15. This is driven by strong growth in Prefabricated building systems, domestic custom molding and textiles.
Prefabricated as an industry is virgin market in India. Applications are only increasing as we move ahead. Be it school, healthcare centers, toilet blocks, mid day meal kitchen. Besides warehousing, worker shelters etc. So the demand outlook is robust. And Sintex is the Pan India player. Corporate Social Responsibility is further opened up doors for large opportunity in corporate spending annually.
Domestic CM is driven by passenger cars segment with use of more plastics while Commercial vehicles are going to be a long term growth driver. Composites per se, will continue to growth with new applications in India and globally. We cater to Fortune 500 companies in auto, electrical accessories, aero space and defense, medical imaging, mass transit.
Textiles business is showing good traction. And we are implement 3,00,000 spindle project expected to commission fully by December. This will fully contribute FY17 onwards and is very lucrative on IRR basis. So outlook is fairly decent for Sintex and the Industry perspective.
2. Sintex Industries Cons PAT witnessed a sharp rise of 91.27% in third quarter. Going forward, do you think earnings performance will continue to outperform?
We are looking at good growth in margins as utilizations improve. Q3 was an exception with MAT credit which boosted PAT. However, I must add if we grow our topline by 20-25% in coming years. Margins improvement will be much better as utilizations will contribute higher to margins.
3. The company has posted a rise in revenue growth of 32%. How do you see the revenue growth for the coming quarter?
I would say, we give annual view on guidance. So we expect good growth for FY15 and Q4 being very strong as usual.
4. Could you tell us about your capex and expansion plan?
For 3,00,000 spindle project we are spending Rs 18 billion. That is the major capex. As a whole we are looking at Rs 3-4 billion on current growth rates.
5. What is your message to the shareholders and investors of the company?
Our message is we will strive to de-risk our businesses and grow stronger looking forward. We address key issues of education, healthcare, sanitation and housing in India. While globally custom modlings is a major segment and India is low cost destination. So we are in a good situation to capitalize on technology and industry. The domestic economy is looking up and we are well entrenched with a leadership across verticles. We will deliver on our promises for all our stakeholders.
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