Astral Limited — Q4 FY25 earnings call

Basically the projections after the anti-dumping beauty have not been factor but we are seeing in this year because PVC has bottom down and the complete channel is try and slowly the PVC will go up a little bit anti-dumping will be addition to that it has not been still implemented by government. the positive thing is the order has been state by the supreme court. So with all the priorities global priorities government has we cannot say when this anti-dumping duty will be in place. But overall if you see the PVC and the polymer will have a positive impact of growth in this fiscal.

Analyst sought clarity on the impact of the anti-dumping duty on PVC, a key raw material, and management acknowledged its potential positive impact on growth despite uncertainty on implementation timeline.

I think for the retail space in terms of adhesives and the chemistries we have finished the complete range weather it is wood working adhesives our maintenance and repair adhesives and sealants and sealants and tapes. I think we have completed range but of course we are looking at newer applications and category expansion wherever we feel is required we look into it. ... I think in construction chemical space we would still be untap in terms of completing the product range but we would be able to do it in next year max I would say but apart from those adhesives and sealant as of now the range we hold can compete with ah the top players in the Indian market no doubt.

Analyst inquired about further expansion in the adhesive market, and management confirmed completion of retail range and plans to complete construction chemical range within the next year, indicating continued growth strategy.

So, we are not giving the individual number earlier we used to give but because of the competitiveness in the market and lot of players are playing strong practises. So because of that we have stop giving the number. But I can say what we have predicted 1500 we almost we are closer crore today. So we have completed I think three years when we given the guidance three and another two year we are going to target the 1500 what we have said. So it cover its not only restricted to this product which you discuss but it cover silency also drain pro also fire also, Valve also and then another couple of products are there I think I have given the list three years before so all put together I think we are more or less moving into that direction only. ... So with regards to I think volume you ask volume guidance see volume guidance largely depends on two things ah when the ATD comes and how much the ATD comes and when the BIS norms are finalized because that will play a very vital role in the channel restocking. Right now the channel is working on very slim inventory levels. So if this both announcements if they come in the end of first quarter or beginning of second quarter then the subsequent quarters the numbers might be in the high double digit also mid double digit also.

Analyst sought specific volume and value guidance, but management declined to give precise numbers due to market competitiveness, instead reiterating a prior ₹1500 crore target for new growth products and linking volume growth to anti-dumping duty and BIS norms.

So ritesh all this three put together we will be close to 500 crore. 450 to 500 crore.

Analyst asked for a combined revenue figure for these specific product lines, and management provided a clear range, indicating their current scale or target.

so basically the accretion people have nothing to do with this these are on the lower land and there are so many seniors that we will be revising our policies on seniors so basically we have now nine of vice president presidents and many of the have join and also we have four divisions to address we dont have one division to eight so there is no question and discussion on that side but the lower end people we did to accretions we there was a hue and cry we said chicken and egg we need people you need sell we increase the value of the man power everyone shouted your man power cost went high now you say man power has been lower the accretion has gone high so what we have to do I dont understand what your questions come up to run my business but we did do some corrections on the man power at the lower end but certain businesses I am telling you again understand if somebody wants to launch a selfone we are sing the same has I launched a network when you launch something you need man power so we needed add more man power in our faucet ceramic ware business we needed more man power for our paint business. I cannot open Gujarat without a man power. I cannot open Rajasthan without in man power. So the cost for initial stages of scaling of the business will take a hit on the man power. So thats the cost which were gone up we get some corrections. They reflect in the actuation. But especially the lower end. Lower end if you go the there is a big pull-on actuations in various segments. And this is happening for most of the building industry company at present because people are coming in the all the segments of business but if you see the senior management which we have in the people are constant and people are with us so the main accretion is on the lower hand.

Analyst questioned the 25% attrition rate, and management clarified it's primarily at the lower end due to scaling up new businesses, while senior management remains stable, explaining the strategic necessity of manpower additions.

It is about 2 and half lakh tons now. ... 10 to 15% value pe badhta rahega.

Analyst sought clarification on the CPVC industry size and growth, and management provided specific figures for both current size and future value growth.

Asked by Rahul from Ikigai

So I can I can add to this you know CPVC has an active anti-dumping duty in place till 2029 so most of of this players who will incur the capexi. CPV putting up a CPVC plant is a very expensive process. CPVC ka jo process hota hai the chlorination process it require a special type of reactors and because chlorine is a corrosive material these reactors are worn out very quickly. So they have to incur frequent capex to install new this reactors every time every few years. So CPVC is a business where they will all the players whoever comes in CPVC it will not be like a PVC market they will need some margin to sustain the business. So it will it will it will sell at whatever this current CPVC pricing is there prevalent in the market it will be around that level only because anti-dumping is also there. So they will they will ensure that they are making inuf margin. It will not become that overnight the prices are going to fall.

Analyst asked about potential price pressure in CPVC due to new supply, and management explained that anti-dumping duties and high capex/maintenance costs for CPVC plants would ensure margins are sustained, preventing a sharp price fall.

Ya I understood the question. MYK firstly is not a regional company. Its a big company and very good products. One thing I will say is we have not even entered MYKs domain and this year is when we enter the MYK domain with the construction chemical range. So for us it will be expansion in portfolio and expansion in product range. So they are all doing their business and I think we will we will definitely go into the grouting space as I was tell talking to Mitten bhai also we are planning for grouting space this year so definitely we are working on that product range and we are it ready ah with the colors and everything and we are going into the cementetious range this year we were kind of in two minds weather to go or not to go because supply chain is is something will we needed to understand that you know its little bit different then how you would sell the AMAT range and white clue so you have to understand the but we understood and its not an issue we always have that in mind when we are benchmarking products and understanding competition. So we go into each range and each product category and then understand who all are operating with in that category and kind of make our strategies accordingly so ya I hope that clears your question.

Analyst raised concerns about strong regional competition in adhesives, and management clarified their strategy to enter new domains like construction chemicals and grouting, emphasizing their focus on product benchmarking and strategic market entry.

Asked by Het Chauxi from Deven Chausi