Stylam Q1 - Expect 12.5% Volume Growth; Margins To Remain Under-Check, Downgrade To Neutral: Yes Securities

Yes Securities Report

Stylam Industries Ltd. reported muted growth in Q1 FY25. Revenue increased by 7.5%YoY to Rs 2.42 billion, driven by 5.7%YoY volume growth (two-year volume compound annual growth rate stood at 5%) coupled with 1.8% improvement in average selling price of laminates to Rs 786/sheet.

Exports (70% of sales and 57% of laminates volumes), reported a revenue growth of 13.4%YoY and ASP came in at Rs 1,000/sheet. Domestic (30% of sales and 43% of laminates volumes), registered a revenue decline of 4%YoY and ASP stood at Rs 583/sheet.

Operating margins contracted to 17.3% versus 18.5%/19.9% in Q1 FY24/Q4 FY24 respectively, largely on account of higher input cost which weighed on gross margins.

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