Tilaknagar Industries Eyes Double-Digit Volume Growth, Margins In H2

Tilaknagar Industries Ltd. is confident of sustaining its margins in the next quarter, and increasing volumes during the second half of the current financial year, Amit Dahanukar, chairman and managing director of the company, said.

Tilaknagar Industries’ consolidated net profit grew 57.2% year-on-year to Rs 58.23 crore in the quarter ended September 2024 versus Rs 37 crore a year ago. The company's Ebitda margin expanded 422 basis points to 17.6% in the September quarter of the ongoing fiscal against 13.4% in the year-ago period.

The Blue Lagoon gin producer received a Rs 10.35 crore subsidy from the Maharashtra government, which further pushed its margins.

Speaking to NDTV Profit, Dahanukar highlighted that even after adjusting the subsidy from the Maharashtra government, the company’s margins were at a healthy level.

“We had a margin of 17.5% for Q2, which includes an income from the government of Maharashtra towards subsidy, which was to the tune of 10 crore. Even if I adjust for the subsidy amount, the margins are coming in at a healthy 15.5%,” he said.

The top executive indicated that 15.5% could be the new normal in terms of margins for Tilaknagar Industries.

“Since commodity prices have stabilised, I don't see any uptick in commodity prices for the next quarter. We are quite confident this could be the further guidance we have for this quarter and ahead,” he noted.

Dahanukar said the company was confident of higher growth in the remaining half of fiscal 2025.

“For the next half year, we are confident of seeing volume growth in the mid-teens. Even with our guidance, we had said it would remain a bit muted because of policy changes in Andhra Pradesh, which is a key market for us, and also due to the national elections,” he noted.

The top executive expected the volume growth momentum to carry on in the second half of the year as well.

“It (volume growth) was subdued as expected, but October has been a good month for us, and we expect momentum to carry on in the next half as well,” he said.

Dahanukar noted there had been market share gains across some of the Southern states. He explained the industry overall had been flattish, whereas Tilaknagar Industries had grown 3%, which has resulted in market share gains in some of its key geographies.

“I think with the consistent and sustained effort in terms of our branding strategy, price laddering, and the communication we have increased in the past two years, we are beginning to see early results of those initiatives,” he said.

Shares of Tilaknagar Industries Ltd. surged 20% to trade at a 52-week high of Rs 349.55 apiece on the NSE on Tuesday. The stock traded at Rs 344.70 per share, up by 18.33% at 1:45 p.m., against the benchmark Nifty's gain of 0.31%.