14 August 2011

Ruchi Soya Industries Update ::ICICI Securities,

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E n h a n c e d   c a p a c i t y   u t i l i s a t i o n   a i d s   g r o w t h   …
Ruchi Soya Industries Ltd’s (Ruchi Soya) Q1FY12 revenue increased
70.6% YoY to | 5,898.9 crore on the back of enhanced capacity utilization.
The company was able to maintain the EBITDA margin at 2.8% and
reported an EBITDA of | 162.3 crore.  Sale of branded products also
increased by 46.8% from | 832 crore in Q1FY11 to | 1,266 crore in
Q1FY12. Higher depreciation and interest outgo weighed on the
bottomline leading to a subdued 26.2%  growth in PAT to | 66.2 crore.
Q1FY12 was a good quarter for the company on the back of rising global
and domestic commodity prices.
ƒ Segmental Analysis
In Q1FY12, the oils, vanaspati and seed extraction segment posted a
YoY growth of 76.4%, 10.2% and 115.3% to | 4,782 crore, | 253.5
crore and | 696.0 crore, respectively. The oils and vanaspati
segment witnessed an EBIT margin expansion while the seed
extraction segment witnessed compression in EBIT margins. EBIT
margin for the oil business increased from 1.7% in Q1FY11 to 1.9%
in Q1FY12 while the EBIT margin for the vanaspati segment
increased significantly from 1.6% in Q1FY11 to 2.0% in Q1FY12.  On
the other hand, EBIT margin for the seed extraction business
decreased from 3.8% in Q1FY11  to 2.9% in Q1FY12. The EBIT
margin in the food business remained flat at 3.2%.
ƒ Volume growth on the back of enhanced capacity utilization
Ruchi Soya witnessed healthy volume growth in Q1FY12. The
capacity utilization of the crushing activity improved 109% to
4,11,601 MT from 1,97,137 MT in Q1FY11. The export volume of
oilseed extraction improved 236%, from 82,832 MT to 2,78,053 MT.  
V i e w
Higher capacity utilization and increased focus on exports aided strong
growth in FY11 and the same has continued in Q1FY12 as well. With
increased capacities Ruchi Soya is  well poised to capitalize on the
incremental demand with capacities in place.

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