Q1 2025 Timken India Ltd Earnings Call Transcript
Key Points
- Timken India Ltd (BOM:522113) reported its best-ever June quarter revenues of INR784 crores, driven by higher volume in most front-ends and better performance in the rail sector.
- The company has a strong balance sheet and robust cash results, enabling strategic investments, including the completion of a new greenfield project in Bharuch.
- The rail sector remains a sustainable growth area for the company, with significant potential for the next 20-30 years due to government initiatives and increasing demand for metro and freight corridors.
- Timken India Ltd (BOM:522113) is exploring opportunities in the wind energy sector, which is expected to grow significantly in India, driven by local manufacturing and export potential.
- The company is focused on improving productivity and efficiency through automation and robotics, which is expected to enhance margins and operational performance.
- PBT margins declined to 16.6% from 17.1% in the previous year, primarily due to increased energy and transportation costs.
- Intercompany sales, particularly exports, were flat, and geopolitical issues continue to pose challenges, impacting costs and delivery times.
- The gross margin has been gradually declining, falling below 40% this quarter, compared to 44-46% three to four years ago, due to higher steel prices and transportation costs.
- The company faces challenges in the export market, particularly due to issues in the Red Sea, leading to increased transportation costs and delays.
- There was a significant increase in other expenditures, attributed to higher freight costs and export-related expenses, impacting overall profitability.
Ladies and gentlemen, good day, and welcome to the Timken India Limited Q1 FY25 Earnings Conference Call, hosted by Batlivala & Karani Securities India Private Limited. (Operator Instructions)
Please note that this conference is being recorded. I now hand the conference over to Mr. Annamalai Jayaraj from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, sir.
Thank you, Mahitha. Welcome to Timken India Limited 1Q FY25 hosted conference call. From Timken India Limited management, we have with us today Mr. Sanjay Koul, Chairman and Managing Director; and Mr. Avishrant Keshava, Whole-Time Director and CFO.
I'll now hand over the call to the management for the opening remarks to be followed by the question-and-answer session. Over to you, sir.
Okay. Thank you. Thank you, and good morning one more time. So the
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