Release Date: August 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Olectra Greentech Ltd (BOM:532439, Financial) reported a 45% increase in consolidated revenue for Q1 FY25, reaching INR313.9 crores.
- The company's EBITDA for Q1 FY25 grew by 22% to INR50.5 crores compared to the same quarter last year.
- Olectra Greentech Ltd (BOM:532439) has a strong order book of 10,818 electric buses, indicating robust demand.
- The company has transitioned to a new state-of-the-art plant at Seetharampur, which is expected to enhance production capacity.
- Olectra Greentech Ltd (BOM:532439) aims to increase its production capacity to 5,000 buses per year by the end of FY25, with plans to scale up to 10,000 buses in the future.
Negative Points
- The company delivered only 156 electric buses in Q1 FY25, which is significantly lower than the annual target of 2,000 buses.
- No electric tippers were delivered in Q1 FY25, despite having an order book for 41 tippers.
- There are concerns about the company's ability to meet its ambitious production targets, given past underperformance.
- The company faces potential risks from delays in tender processes and the need for timely delivery to avoid penalties.
- Olectra Greentech Ltd (BOM:532439) has taken on significant debt to finance its new plant, which could impact financial stability if not managed properly.
Q & A Highlights
Q: Could you please tell us how many buses you have delivered and e-tippers in this quarter?
A: We have delivered about 156 electric buses in this quarter. We have not delivered any tipper in this quarter. (B. Sharat Chandra, CFO)
Q: Regarding the execution, I think we have a target of 2,000 buses for this year, we have delivered 156. Do you think that we are on track to complete the balance quantity in the upcoming three quarters?
A: We are well set to meet our targets, which could be in the region of 1,500 to 2,000 numbers this year. We expect the quarter two numbers to more than double compared to quarter one, and in H2, we are expecting about 1,000 plus numbers. (B. Sharat Chandra, CFO)
Q: What is the monthly production rate as of now?
A: We have transitioned to the new plant this quarter. We now have the capacity to produce over 200 buses per month, and by the end of the year, we are targeting to increase the capacity to about 5,000 numbers, which is approximately 400 buses per month. (B. Sharat Chandra, CFO)
Q: Are there any updates on the PM e-Seva second tender and the U.P. tender?
A: The CSL to PME, e-Seva tender is yet to be bidded by all participants. The U.P. tender was MCC and the due date has not yet come. (Ramesh Naidu, Head of Strategy)
Q: Are we developing more EV products like an electric double-decker bus?
A: No, we are not in the process of developing double-decker buses as of now. Since the quantities are very less, we do not see a great future in double-decker buses. (B. Sharat Chandra, CFO)
Q: What is the biggest risk you are looking at in the coming few quarters?
A: As of now, we are not foreseeing any major challenges. Last year, we had battery compliance norms which were stringent, but currently, we do not have any major challenges to meet our targets. (B. Sharat Chandra, CFO)
Q: Are we operating at full capacity in our new plant?
A: By the end of quarter one, we have an installed capacity of about 200 buses per month. We have not yet achieved full capacity and are working at less than full capacity. We plan to operate at 80-85% capacity in H2. (B. Sharat Chandra, CFO)
Q: What do you think about margins in the next couple of quarters? Will they improve?
A: We have been operating at healthy margins. Over the long term, we expect margins to be in the region of 10-12%, keeping in mind market dynamics and volumes. (B. Sharat Chandra, CFO)
Q: Are there any plans for CapEx in other technologies like hydrogen?
A: As of now, we do not have any CapEx plans for other technologies like hydrogen. We are focusing on completing the delivery of the existing order book of electric buses and introducing various products within the EV segment. (B. Sharat Chandra, CFO)
Q: Are you planning to raise funds in the coming quarter or financial year?
A: As of now, there is no plan to raise funds. (B. Sharat Chandra, CFO)
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
