Detailed Narrative
Record-Breaking Q4 and FY25 Performance
Skipper Limited delivered its highest ever quarterly revenue of INR1,288 crores in Q4 FY25, reflecting an 11.6% sequential growth. EBITDA for the quarter stood at INR123 crores, up 14% year-on-year, with margins expanding to 9.6%. Consolidated PAT surged by 90% year-on-year to INR47.9 crores, improving PAT margins to 3.7%. For the full fiscal year FY25, the company achieved a record annual revenue of INR4,624 crores, a robust 41% growth over FY24, and an 83% increase in consolidated PAT to INR149 crores.
Strong Order Book and Inflows
The company reported its highest ever annual order inflow of INR5,335 crores in FY25, with INR1,592 crores booked in Q4 alone. The closing order book as of March 31, 2025, stood at INR7,458 crores, representing a 20% year-on-year increase and providing robust revenue visibility for the next 18 to 24 months. The current bidding pipeline is over INR20,000 crores, with management expecting a minimum 25% success rate.
Capacity Expansion and Digital Transformation Initiatives
Skipper's 75,000 tons capacity expansion is on track and expected to be fully operational by Q1 FY26, with revenue contributions anticipated from Q2 onwards. The company plans to add another 75,000 tons capacity this year (FY26) through a brownfield/greenfield expansion, involving an estimated capex of INR200 crores. This aligns with the overall capex guidance of INR800 crores over the next four years. Additionally, the implementation of SAP S/4HANA RISE is underway to streamline operations and enhance efficiency.
Strategic Growth in Polymer Business
The Polymer business delivered its highest ever quarterly revenue of INR138 crores, marking a 34% year-on-year growth. This was driven by increased focus on the plumbing segment, an enhanced retail distribution network, and product diversification. Management anticipates a 25-30% growth in the Polymer segment for FY26-FY27 and has secured necessary approvals to foray into the gas pipeline segment with MDP pipes, leveraging existing HDP infrastructure.
Expanding Export Footprint, Including U.S. Market Breakthrough
Export revenue grew by 21% to INR770 crores in FY25, constituting 22% of the overall Engineering segment business. Skipper achieved a landmark breakthrough in the U.S. market by securing a multi-million dollar coal supply order worth $15 million. The current U.S. bid pipeline is approximately $150 million, and management expects these export orders to yield at least 2% better margins than domestic products, capitalizing on the 'China Plus One' narrative.
Improved Capital and Debt Management
Despite a significant 41% increase in revenue, Skipper successfully reduced its net debt (including interest-bearing acceptances) by INR111 crores year-on-year, bringing it down to INR1,016 crores. The Return on Capital Employed (RoCE) improved to 21.7% in FY25 from 19.1% in the previous year, demonstrating enhanced capital efficiency. The company aims to further improve its working capital days and reduce finance cost as a percentage of sales to closer to 4% for FY26.
Positive Outlook and Long-Term Transmission Demand
Management projects an overall revenue growth of 20-25% for the next 2-3 years, including the Infrastructure segment, building on the elevated base. They expressed strong optimism regarding the long-term demand for transmission infrastructure, estimating that transmission capex will continue for at least the next two decades. This sustained demand is driven by global moves towards net-zero and the increasing adoption of renewable energy sources.