Q2 2024 Orient Electric Ltd Earnings Call Transcript
Key Points
- Orient Electric Ltd (BOM:541301) reported an 11% overall growth in top line for Q2 FY '24, with fan growth close to 25%.
- The company has successfully doubled its revenues in the direct-to-market (DTM) space, enhancing its product mix and upselling opportunities.
- E-commerce and modern retail routes have shown close to 50% growth, indicating strong traction in these channels.
- Gross contribution margins improved by 400 basis points year-on-year, reflecting better cost management and product mix.
- The company is focusing on strategic levers such as revamping go-to-market structures and enhancing service quality, which are expected to drive long-term growth.
- Profitability remains a concern, with the company indicating that it may take a couple of more quarters to see significant improvements in EBITDA and PAT.
- The Hyderabad project has faced delays due to visa issues for foreign technicians, impacting the expected benefits from this investment in the current year.
- The lighting segment showed only a small growth year-on-year, with significant price erosion in the B2C segment affecting overall performance.
- The transition to direct-to-market in new states may cause short-term disruptions and hurt volumes temporarily.
- The working capital cycle has increased slightly due to higher inventory levels in preparation for the Diwali season, impacting cash flow.
Ladies and gentlemen, good day, and welcome to the Orient Electric Ltd. Q2 FY '24 Earnings Call hosted by ICICI Securities. [Operator Instructions] Please note that this conference is being recorded. I now hand the conference over to Mr. Aniruddha Joshi from ICICI Securities. Thank you, and over to you, sir.
Yes. Thanks, Tayo. On behalf of ICICI Securities, we welcome you all to Q2 FY '24 Results Conference Call of Orient Electric. We have with us today, senior management represented by Mr. Deepak Khetrapal, Vice Chairman and Managing Director; and Mr. Saibal Sengupta, Chief Financial Officer. Initially, I will request the management to indicate about the quarterly performance as well as half yearly performance, and then we will open the floor for a question-and-answer session. Thanks, and over to you, sir.
Thank you, Aniruddha. Thank you very much. Good afternoon, everyone, and a
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