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Shares of Chaman Lal Setia Exports (CLSEL) zoomed 17 percent to Rs 155.2, touching a multi-year high on BSE in intra-day trade on Monday (Feb 6, 2023) in an otherwise weak market, after the company reported a strong operational performance for the December quarter. Later (Q3FY23).
The stock touched its previous high of Rs 145.75 on January 19, 2023. It traded at its highest level since May 2018. At 11:48 am, the CLSEL was up 15 percent at Rs 152, compared to a 0.69 percent fall in the S&P and the BSE Sensex. The average trading volume over the counter increased by more than 10 times that day. A combined 1.42 million equity shares, representing 2.75 percent of the company's total equity, changed hands on NSE and BSE.
For Q3FY23, earnings before interest, depreciation, tax and amortization (EBIDTA) were up 130 percent year-on-year (YoY) to Rs 51 crore, supported by moderation in freight expenses and the company’s efforts towards operational efficiency. EBITDA margin increased by 430 bps to 14.5 percent compared to 10.2 percent last year on account of superior realization and moderation in the freight cost.
Revenue was up by 62 percent YoY to Rs 354 crore for Q3FY23 due to market share expansion in key geographies and further strengthening of the distribution network. Consequently, the net profit also increased by 134 percent YoY to Rs 37.5 crore in Q3FY23 compared to Rs 16.0 crore in Q3FY22.
For Q3FY23, the export volume grew by 44 percent YoY and export sales grew by 66 percent YoY to Rs 312.4 crore. Average export realization in the period increased by 15 percent YoY, the company said.
CLSEL is one of India’s largest basmati rice exporters. It has processing facilities in Karnal (Haryana) and Kandla (Gujarat). The company exports under its flagship brand “Maharani” apart from private labels to more than 90+ countries and have 440+ distributors spread across the world.
In November 2022, CRISIL Ratings upgraded its rating on the long-term bank facilities of CLSEL to ‘CRISIL A’ from ‘CRISIL A-‘and revised the outlook to ‘Stable’ from ‘Positive’.
The upgrade reflects sustained improvement in the business risk profile of the company, as indicated by 8 percent revenue growth in FY22, which is supported by healthy demand from exports leading to growth in volumes sold, better price realization and geographically diversified operations with customer presence in more than 90 countries.
The rating also reflects continuous improvement in the financial and liquidity risk profiles of the company. The financial risk profile continues to remain healthy with a strong net worth and comfortable capital structure in the absence of long-term debt in the books. Liquidity is supported by robust cash accrual and healthy unencumbered cash and bank balance of Rs 258 crore as on September 30, 2022, it added.
The company has maintained healthy unencumbered cash and bank balance of Rs 258 crore as on September 30, 2022. Promoters’ support in the form of unsecured loans will continue to aid the liquidity profile of the company. The current ratio was healthy at 4.72 times as on March 31, 2022, and is expected to be 5-6 times over the medium term. The rating agency believes CLSE will continue to benefit from its strong presence and healthy relationships with clients.
Source:
Online/GFMM
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