SURYAROSNI - Surya Roshni Ltd. Share Price

Question 1: "We have done roughly 3.8 lakh tons in the first half. And you are saying that we will do 1 million tons. So, you are saying that we will do 6.2 lakh tons in Q3 and Q4."

Answer: We have done a gross of 4.1 lakh tons in Q1 and Q2. In Q3, we will achieve 2.6 lakh tons, and in Q4, we are targeting 3 lakh tons. This brings our total volume to 9.8 lakh tons for the year. Initially, we anticipated 10.5 lakh tons, so we are revising this down by about 60,000 to 70,000 tons based on our performance.

Question 2: "Regarding the export growth, did you receive repeat orders from the US, and is this growth sustainable?"

Answer: The US orders were a one-off, but we saw significant growth from European countries and Canada, where our brand is gaining recognition. Future export growth looks promising, although the US market remains uncertain, with ongoing inquiries but no firm orders yet.

Question 3: "With the ongoing challenges, why are we not achieving our targeted capacity growth?"

Answer: I understand your concern. Several factors affected our growth, including shortfalls in GST impacting cement purchases and an extended monsoon that hindered agricultural demand. However, we successfully maintained our performance through exports and domestic sales.

Question 4: "You mentioned an EBITDA target of INR 180 crores for Lighting. Is this feasible considering our H1 EBITDA was only INR 70 crores?"

Answer: Our confidence stems from seasonal demand during festivals like Diwali and Christmas, where historically, 60-65% of our revenue comes in the second half. Additionally, our new wire business is projected to contribute significantly to that target.

Question 5: "What is the timeline for reaching the two million tons manufacturing capacity?"

Answer: We plan to increase our capacity from 1.35 million tons to 1.95 million tons in the next 1.5 to 2 years through ongoing investments in our facilities and greenfield projects, which focus on higher-margin sections and more value-added products.

Question 6: "Can you provide insights on how you will navigate the challenges of falling steel prices?"

Answer: Predicting steel prices remains complex, but I believe the current range of INR 46,000 to INR 46,500 may hold until March. We manage our inventory smartly, given we are converters, which minimizes risks related to price fluctuations.

Question 7: "What is your R&D investment in electrical products, and how are you handling the impact of China's issues?"

Answer: We invest around INR 18-20 crores annually in our R&D center. For lighting, approximately 30% of our revenue comes from imports, but we've diversified sources to mitigate risk. In-house production of key components is helping reduce dependency and improve margins.

Question 8: "What is your plan for future cash reserves beyond dividends?"

Answer: We are committed to shareholder returns, which is evident from our recent dividend announcement. Future investments will focus on working capital and strategic CAPEX, supporting both growth and value creation for our shareholders.