Replying to shareholders at the company's AGM here, Amritanshu Khaitan, managing director, said, "Regarding the borrowing of the company, the company's debt position has become much more comfortable as compared to last year."
The Khaitans, promoters of Eveready, held a 27.39% equity stake at the end of the third quarter last fiscal.
Dry cell battery major Eveready Industries on Tuesday said that backed by greater profitability, its cash flow generated from operations this fiscal would be significantly higher and would help it repay its borrowings “comfortably”.
Replying to shareholders at the company’s AGM here, Amritanshu Khaitan, managing director, said, “Regarding the borrowing of the company, the company’s debt position has become much more comfortable as compared to last year.”
The company’s total debt fell by close to 19% to Rs 293.03 crore at the end of the last fiscal from Rs 360.99 crore at the start of the fiscal.
“The cash flow generated from the operations will be significantly higher (during this financial year) as compared to last year, and that will comfortably help the company repay the borrowings,” Khaitan said.
On the company’s sales performance during the second quarter, he said, “There has been a very smart recovery in sales going into the months of July, August and September. So, you will see the reduction in the de-growth … which will reflect positively on the Ebitda and the profits of the company.”
On a consolidated basis, Eveready posted a 20.5% year-on-year fall in its revenue at Rs 263.44 crore during the first quarter this fiscal. However, buoyed by improved gross margin and lower costs, it reported over a three-fold y-o-y jump in its net profit to Rs 24.99 crore for the first quarter, as against Rs 6.91 crore in the corresponding period last fiscal.
For FY 2019-20, the company’s operating Ebitda was Rs 121.13 crore, which was almost on a par with that of the previous year.
“As the country continues to come out of the various phases of lockdown, we are seeing a steady demand for batteries and flashlights. We continue to witness sharp decrease in import of cheap batteries from China, disruption in supply chain of the unorganised market for flashlights — which is helping demand for our products. As festive season approaches and supply chain normalises, demand for lighting products is also expected to increase. Given the outlook, we expect to improve operating margins in the forthcoming quarters,” he said.