I G Petrochemicals Limited: Q3 FY25 Earnings Call

February 14, 2025 · 3 min read

Earnings Call Transcript Analysis Report #

Revenue: Q3 FY'25 revenue stood at INR567 crores, a 15% year-over-year growth. 9-month FY'25 revenue was INR1,749 crores, up 12% year-over-year.
Gross Profit: Q3 FY'25 gross profit was INR123 crores, a 94% year-over-year increase. 9-month FY'25 gross profit was INR411 crores.
Gross Margin: Q3 FY'25 gross margin improved by 890 basis points year-over-year. 9-month FY'25 gross margin improved by 480 basis points.
EBITDA: Q3 FY'25 EBITDA was INR54 crores with a 9.6% margin. 9-month FY'25 EBITDA was INR195 crores, a 94% increase year-over-year.
Profit After Tax (PAT): Q3 FY'25 PAT was INR28 crores, the same as Q2 FY'25. 9-month FY'25 PAT was INR91 crores, a significant increase year-over-year compared to the previous full financial year’s INR40 crores.
Debt: The company remains a net debt-free company with a strong balance sheet. Debt is around INR225 crores to INR230 crores, with cash and liquid investments around INR300 crores.

Advanced Plasticizer Plant: Setting up a 75,000-ton capacity advanced plasticizer plant with an investment of around INR165 crores plus GST, expected to commission by December 2025.
CBG (Compressed Biogas) Plant: Venturing into CBG with a 5-ton per day plant in India; EPC contract assigned, moving from planning to implementation.
Renewable Energy: Integrated solar power and renewable energy sources in warehouses and operational areas to reduce power expenses.

Phthalic Anhydride Market: The expected market size of phthalic anhydride is around 500,000 to 550,000 tons per annum, with a growth rate of 5% to 10% per annum.
Competition: Addressing competition in maleic anhydride from Chinese manufacturers.
Raw Material Sourcing: Diversifying raw material sourcing, aiming for 70%-80% domestic and 15%-20% import.
Plasticizer Market: Indian plasticizer market has a capacity of 450,000 to 500,000 tons, growing at 5% to 7%.
Geopolitical Environment: Global geopolitical environment has been challenging, leading to economic uncertainty impacting global trade investment and consumption.

Raw Material Availability: Addressed concerns about raw material availability (OX) with only one domestic producer.
Oversupply: Maleic prices are low due to oversupply from China, impacting revenue.

Volume Outlook: Expecting sales volume of around 50,000 tons for the next quarter (Q4 FY'25), potentially increasing to 55,000 or 56,000 tons from April onwards.
FY'26 Revenue: Anticipating revenue to be between INR3,200 crores to INR3,300 crores by FY'26-‘27, assuming optimal plant utilization.
Plasticizer Plant Revenue: Expecting INR900 crores to INR950 crores gross revenue from the plasticizer plant at optimum capacity
CBG plant IRR: CBG plant is expected to provide between 15% to 18% of IRR based on the current market price.

Capacity Utilization: Profitability is impacted because the company is operating at 75% to 80% capacity utilization, while expenditures are accounted for based on total capacity
Maleic Prices Impact: Maleic prices are a key concern. “the maleic prices are actually in the last 2 to 3 years low, $780 to $790 in the international market”

Optimistic: Management expressed optimism about the upcoming quarter and is prepared to capitalize on emerging market opportunities.
Confident: Confident about domestic demand.
Cautious: Cautious about international market margins.

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