Camlin Fine Sciences Ltd - Feb 2025 Earnings Call Transcript Analysis

February 17, 2025 · 3 min read

Earnings Call Transcript Analysis Report #

Turnover (Q3FY25): Increased by 2% to Rs. 433.49 crores from Rs. 422.97 crores.
Gross Margins (Q3FY25): Increased to 50% from 48%.
Operational EBITDA Margin (Q3FY25): Increased to 12% from 10%.
Reported EBITDA (Q3FY25): Rs. 48.8 crores. After adding back forex loss of Rs. 4.4 crores, it becomes Rs. 53 crores.
EBITDA from Continuing Operations (Q3FY25, pro-forma): Estimated at Rs. 70 crores, by adding back losses from European (Rs. 16 crores) and China operations (Rs. 3-4 crores) to the adjusted EBITDA of Rs. 53 crores.
Foreign Exchange Impact: A notable foreign exchange loss was recorded in Q3FY25, contrasting with a gain in the previous quarter. Finance cost also includes FX impact on long-term debt.
Debt: Gross debt is around Rs. 600 crores after repaying a Rs. 100 crore NCD.
Interest Cost: Increased Q-o-Q due to a Rs. 100 crore borrowing (subsequently repaid) and FX fluctuations on dollar-denominated long-term borrowings. Average rate of interest for consolidated balance sheet is 9.5%-10%.

No explicit revision to overall financial guidance, but positive commentary on improving trends.

Growth: Vanillin vertical showing improving prices and output (600 MT in Q3FY25 vs. 500 MT in Q3FY24). Blends vertical continues strong growth (20% YoY).
Decline/Pressure: European operations continue to incur losses (Rs. 16 crores fixed cost in Q3FY25). China operations also loss-making (Rs. 3-4 crores per quarter).

Rights Issue: Successfully completed with overwhelming response. Proceeds used to repay Rs. 100 crore NCD, with funds also reserved for scheduled debt repayment and general corporate purposes.
European Operations Wind-Down: Ongoing process to rationalize costs by shutting down diphenol activity. Goal to significantly reduce losses from Q1FY26.

Vanillin Portfolio Expansion: Plans to get into all different types of Vanillin, including natural Vanillin, to become a complete solution provider.
Value-Added HQ & Catechol Products: Focus on launching and scaling up new products beyond current offerings.

Vanillin Production Ramp-up (Dahej): Output increased to 600 MT in Q3FY25. Plan to reach ~70% capacity utilization by end of FY25 (March 2025) and 75% in FY26.
Diphenol Plant Utilization: Working at ~75% capacity in Q3FY25, expected to reach 85-90% in Q4FY25.

Vitafor Integration: Integration is complete. Focus for FY26 is to grow the animal feed blends business by 20-25% through new registrations and market rollouts (Mexico, Colombia, Peru, India, US, Brazil). Vitafor is EBITDA breakeven.

Anti-Dumping Actions: Significant impact on Vanillin pricing, especially in the US (duty levied) and Europe (duty proposed).
Chinese Influence: Persistent impact on pricing and supply across relevant chemical segments.
Dynamic Pricing: Vanillin prices are volatile, influenced by anti-dumping measures and market-specific conditions.

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