HPL Electric Q2 FY20 EBITDA Rises by 5% driven by Healthy Growth in Meters & Lighting Business
New Delhi, November 15, 2019 – HPL Electric and Power Ltd (referred to as the “Company”; NSE: Symbol; HPL, BSE: Scrip Code;540136),an established electric equipment manufacturing company in India, manufacturing a diverse portfolio of electric equipment, announces their financial results for the quarter ended September 30, 2019.
· Metering business continued its growth momentum in the second quarter as revenues grew by 22% QoQ and 3% YoY driven by timely execution of orders
· Lighting business witnessed robust growth with revenues growing by 48% QoQ and 12% YoY. Growth was majorly led by network expansion, and offering a wider range of products to consumers
· Contribution of the switchgear segment remained muted due to lower demand in real estate, industrial and infrastructure markets
· Q2 FY20 EBITDA Margins expanded by 123 bps to 12.9%driven by increased revenue contribution from higher-margin metering business (61% in Q2FY20 Vs 56% in Q2FY19) and efficient cost management
Mr. Gautam Seth, Joint Managing Director said, “As per our guidance given post the Q1FY20 results, our metering and lighting segments posted strong double-digit growth on a sequential basis. Metering business grew by 22% QoQ to ₹165.3 Crores and Lighting Business grew by 48% QoQ to ₹51.5 Crores. Our focus on improving operating profitability continued as our EBITDA margins expanded by 123 bps to 12.9% in Q2 FY20 led by increase in share of higher-margin metering business, and efficient cost control.
On the product innovation front, we are continuously looking to launch innovative products in various categories. HPL’s association with the Haryana Steelers Pro Kabaddi team as its “official LED lighting partner” is yielding positive results in the lighting trade segment.Going forward, we expect our metering, lighting, and wires & cables segments to see strong growth on a year-on-year basis in Q3FY20. In the meters business, healthy order book combined with increased enquiries and tenders provides good revenue visibility for the rest of this year. Further, favourable policy measures like the Government’s plan to set up a ₹25,000 crore fund to revive stalled housing projects and the increased government spending is expected to further boost demand for HPL’s products especially for domestic switchgears.”
Robust Order Book & Strong Revenue Visibility
· Consolidated current order book stands at ₹390.3crores (Net of GST)
o Metering orders of ₹361.4crores
o Switchgear orders of ₹19.6 crores
o Lighting orders of ₹8.2 crores
o Wires & Cables orders of ₹1.1 crores
o Enquiry base for Metering tenders are at a healthy level.Tenders amounting to ~₹2,000 crores (~1.6 crore meters) have been floated or expected to be floated in the near-term.This provides good visibility and positive outlook for the coming quarters.