Business Update
- The demand for roofing products by the retail segment was not depressed as such but due to lower liquidity traders demand was not that great
- The roofing industry was one of the first industry to open up and rthere are adequate stocks to supply in the market
- 50% of the steel building sites have become operational but working on minimal strength
- Have witnessed stroing demand for roofing products from areas that are opening up
- The boards business is seeing poor business and sites are not seeing work and hence demand is subdued
Participants
- GIRIK Capital
- Edelweiss
- Kedia Securities
- Phillip Capital
QnA
- There was not a complete shutdown in rural India like it was witnessed in urban India
- Deman was very strong in May but unable to say whether it was due to pent up demand from April or it is a trend for the future
- The migrants coming back to villages is not a positive because these are people who have no money and who have left there jobs and who in the first place moved because they had no opportunity in the villages
- There is a shortage of steel roofing sheets in the market and thus this has enabled to have better growth in roofing products and also enabled pricing increase
- In the last 6 months have worked a lot in streamlining operations and cut down on wastages in operations that have helped the steel building segment margins
- Not taking orders at low margins and looking at better realisation orders. Also steel prices have been stable and coming down
- Will want to wait for sales data of June and July which will give an indication as to which direction is the economy moving in
- The company had built up inventories for the peak season and all inventories that were built up will be easily liquidated during the coming months
- Going forward crop prices will be a bigger determinant in Q3 & Q4 of this fiscal year
- The APMC regulations being disallowed will help the farmer in realising higher prices as their was a 50% gap in prices farmer was getting and what end customer was paying
- However the implementation of this reform on thr ground needs to be monitored properly
- Looking at rationalisation of inventories on the finished goods side, saving costs on all operational front as well to conserve cash
- In the roofing business see demand continuing properly. In the boards and panel business getting new enquiries which I feel now are driven by Covid
- Over the last year while prices were stagnant over the year costs of raw materials and also operational costs had gone up sharply which affected profitability
- There are only two production lines on which we are not operating currently and all 35 depots are now operating normally
- In the steel building segment there is a problem of labour because most of the labour has gone away and on all sites working under extremely difficult situation with limited labour.
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