Manorama Indust.

Manorama Industries Limited reported robust growth in FY25, with revenue reaching ₹771 crores, a 69% year-on-year increase. This performance was attributed to strong market demand for specialty butters and fats, coupled with economies of scale from new fractionation facilities. EBITDA grew 1.6 times year-on-year to ₹191 crores, expanding the margin by 870 basis points to 24.8%. Profit After Tax (PAT) surged almost 2 times to ₹112 crores, with a PAT margin of 14.5%.

The company successfully commercialized a new 25,000 tons fractionation capacity in Q2 FY25, bringing the total fractionation capacity to 40,000 tons per annum. The existing 15,000 tons facility operated at 100% utilization, while the new unit achieved 40-50% utilization for the full year, resulting in a combined utilization of 62.5% for FY25. For FY26, the company projects combined capacity utilization to increase significantly to 75-85%, aiming for greater operational efficiencies.

Manorama Industries has expanded its global footprint by establishing strategic subsidiaries in West Africa, the UAE, and Brazil to strengthen its market presence. The company's R&D team developed new products in FY25, including various filling fats and frozen dessert applications, and is tapping into new geographies. Management noted a significant demand-supply gap in the specialty niche market globally, particularly in Latin America, which is projected to be a 25,000 to 30,000-ton market for CBE and stearin.

The company's EBITDA margin expanded by 870 basis points to 24.8% in FY25, driven by efficient cost management and operating leverage. PAT margin also saw a substantial increase of 576 basis points to 14.5%. Management emphasized a continuous focus on operational efficiencies, premiumization initiatives, and disciplined execution to sustain healthy margins. The contribution of value-added products like CBE to sales increased from 10% last year to 30% this year, further supporting margin improvement.

Manorama Industries has trimmed its working capital days from 180 to 150 days in FY25 and aims to further reduce them to 120-140 days in FY26. Net debt stood at ₹380 crores as of March 31, 2025, primarily comprising working capital loans, with a net debt-to-equity ratio of 0.83:1. The company plans to reduce net debt going forward^⏳ and aims for receivables days of around 30 days for FY26. Inventory, including raw materials and finished goods, was ₹549 crores as of March 31, 2025.

The company has several forward and backward integration projects planned, which are currently in advanced drawing and planning stages. Management stated that a comprehensive report with detailed financial plans for these projects would be shared with shareholders once approved by the Board. These capex plans are expected to be funded through healthy internal accruals, with construction anticipated to begin this year. The company aims to start these projects within a period of less than 3 years.