Galaxy Surfactants reported a decline in its operating revenue in third quarter but managed to lower their finance costs. Operating revenues for the company were down 7.9 percent year on year and raw material to sales ratio was at 67.35 percent versus 70.22 percent YoY. Finance cost was lower in the quarter at Rs 5.8 crore versus Rs 7.1 crore YoY. The year on year EBITDA margins came in at 13.6 percent versus 12.3 percent.
Sharing further details on the quarterly performance, U Shekhar, Managing Director of the company said, the flat growth in topline was on account of raw material prices. For most of the last quarter the raw material prices were at possibly 10 year lows. Of course they did correct starting from end of last month and they did go up but came down again due to the coronavirus.
"Raw material prices keep going up and down, and our revenues go in sympathy with that,” he said in an interview with CNBC-TV18.
Galaxy Surfactants Ltd. (GSL) is one of the leading organisation in India, manufacturing Performance Products and Specialty Chemicals for the Personal and Home Care Industry.
With regards to growth in volumes he said, “Last quarter it was encouraging. We had almost 4.8 percent volume growth as far as India was concerned after almost four quarters of muted growth in India. Overall, we had a volume growth of about 5.6 percent for the first nine months of this year. The situation has been stable and not very discouraging.”
He further added, “Egypt has come back on its own. For the first nine months it has seen a 9.2 percent volume growth. So overall, I would say it has been a decent nine months though not as good as what we would have expected it to be.”
Giving his outlook for FY21, he said, “We are optimistic, but I would say India has got its mojo back to the number of 10-12 percent or so."
"Our customers have sounded very cautiously optimistic as far as the coming quarters are concerned. We have always said that we would grow ahead of the market as far as India is concerned. Egypt has been pretty encouraging as well, it has gone back to its original position with respect to the market. As far as our speciality products are concerned there are more customers and the momentum in continuing to be maintained.”