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Chaman Lal Setia Exports zooms 17% on strong Q3 operational performance

EBITDA margin increased by 430 bps to 14.5 per cent compared to 10.2 per cent last year on account of superior realisation and moderation in the freight cost.

Basmati Rice
Basmati Rice
SI Reporter Mumbai
3 min read Last Updated : Feb 06 2023 | 11:55 AM IST
Shares of Chaman Lal Setia Exports (CLSEL) zoomed 17 per cent to Rs 155.2, hitting multi-year high on the BSE in Monday’s intra-day trade in an otherwise weak market, after the company reported a strong operational performance in December quarter (Q3FY23).

The stock surpassed its previous high of Rs 145.75 touched on January 19, 2023. It traded at its highest level since May 2018. At 11:48 AM, CLSEL was up 15 per cent at Rs 152 as compared to a 0.69 per cent decline in the S&P BSE Sensex. The average trading volumes on the counter jumped over 10-fold today. A combined 1.42 million equity shares, representing 2.75 per cent of total equity of the company, had changed hands on the NSE and BSE.

For Q3FY23, earnings before interest, depreciation, tax and amortization (EBIDTA) was up 130 per cent 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 per cent compared to 10.2 per cent last year on account of superior realisation and moderation in the freight cost.

Revenue was up by 62 per cent YoY to Rs 354 crore for Q3FY23 due to market share expansion in key geographies and further strengthening of distribution network. Consequently, the net profit also increased by 134 per cent YoY to Rs 37.5 crore in Q3FY23 compared to Rs 16.0 crore in Q3FY22.

For Q3FY23, the export volume grew by 44 per cent YoY and export sales grew by 66 per cent YoY to Rs 312.4 crore. Average export realization in the period increased by 15 per cent YoY, the company said.

CLSEL is one of India’s largest basmati rice exporter. 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 has 440+ distributors spread across the world.

In November 2022, CRISIL Ratings had 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 per cent revenue growth in FY22, which is supported by healthy demand from exports leading to growth in volumes sold, better price realisation 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 strong networth 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. 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.


Topics :Buzzing stocksRice Chaman Lal Setia ExportsMarket trendsstock market tradingQ3 results

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