Modi Naturals Ltd (BOM:519003) Q4 2025 Earnings Call Highlights: Robust Revenue Growth and ...
Release Date: May 29, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Modi Naturals Ltd (BOM:519003) achieved significant revenue growth of 58.5% year-on-year in Q4 FY25.
The company's EBITDA for the quarter grew by 189%, showcasing strong operational performance.
The ethanol division is operating at optimal capacity and is a key pillar of long-term growth, aligned with government policies for sustainable energy.
The consumer division, particularly the flagship Olive brand, delivered exceptional performance, aligning with health-conscious consumer trends.
The company has successfully expanded its distribution footprint, enhancing accessibility through partnerships with e-commerce and quick commerce platforms.
Input cost volatility and macroeconomic challenges posed headwinds, impacting the company's operations.
The bulk division faced challenges due to government-imposed reductions in oil prices, although recovery is underway.
The company experienced increased expenses in Q3 and Q4 FY25, impacting EBITDA margins.
The initial rollout of the ethanol plant faced operational challenges, although these have been addressed.
The company has not yet provided a detailed breakdown of expected revenue contributions from its three main segments for the upcoming fiscal year.
Warning! GuruFocus has detected 4 Warning Signs with BOM:519003.
Q: What is the current utilization rate of the ethanol plant, and what are the growth drivers for Q1 and Q2 of FY26? A: The current plant is running at full capacity. With the upcoming expansion, we expect higher capacities later in the year. The consumer division has shown growth, with Q1 expected to see further increases. The growth is driven by increased expenses and focus on the consumer division.
Q: How long will it take to ramp up the new ethanol capacity to optimal utilization? A: We expect to commission the new capacity by the end of Q2 or early Q3. It is safe to assume 50-60% utilization in Q3 and closer to 90% in Q4.
Q: What were the reasons for outperforming in the ethanol division but falling back in bulk and other divisions? A: In the bulk division, we have recovered from FY24, and FY25 marks a recovery. The consumer division grew by about 6% year-on-year. We scaled back on ad spends in the first two quarters and increased them later, which brought back growth.
Q: Are there plans to expand the ethanol division beyond 310 kLPD, and do you have sufficient land for this? A: We are expanding from 130 kLPD to 310 kLPD and have enough land for further expansion. The infrastructure was planned with scalability in mind, and the expansion is taking place on the same premises.
Q: What are the sustainable margins in each business segment? A: The bulk division has a volatile component, so we refrain from commenting. The branded division started FY25 with about a 15% margin, averaging 8.5% for the year. We aim to maintain 8.5-9% this financial year, with a potential range of 12-15% annually.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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