In This Article:
Release Date: May 06, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Jash Engineering Ltd (NSE:JASH) reported a strong financial year with a revenue growth of 43% year-on-year.
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The company has a diversified revenue composition, with significant contributions from water control gates, screening equipment, and valves.
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Jash Engineering Ltd (NSE:JASH) has a healthy order book position, with a combined order book of 838 crores, including significant international projects.
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The company is projecting a combined revenue of 860 crores for the next financial year, with growth expected across all subsidiaries.
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Jash Engineering Ltd (NSE:JASH) is strategically expanding its operations, including plans for a new plant in Houston to address manufacturing constraints in the US.
Negative Points
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The company experienced a drop in EBITDA and PAT margins, with a 2% and 1% decline respectively, attributed to cost overruns and execution challenges.
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Jash Engineering Ltd (NSE:JASH) faces manpower constraints in its US operations, particularly in Orange, affecting production capacity.
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The company is dealing with tariff impacts on US imports from India, which could result in an 8-10% hit on margins.
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Execution of large projects like the Kansas City project has led to cost overruns and impacted profitability.
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The company is facing challenges in scaling up its Waterfront acquisition, with revenue growth not yet proportional to the increase in workforce.
Q & A Highlights
Q: Can you clarify the impact of US tariffs on your business and how it affects your revenue? A: The revenue from India to the US is only 31% of our US revenue. Out of this, only 30 to 40 crore worth of material is subject to tariffs. The impact on our overall US revenue is estimated to be around 8 to 10%, as we may not be able to pass on all the costs to our clients. - Mr. Pratik Patel, Chairman and Managing Director.
Q: What are the challenges faced by Rodney Hunt in the US, and how do you plan to address them? A: The main challenge at Rodney Hunt is the lack of manufacturing manpower in Orange, Massachusetts. We are considering setting up a new plant in Houston, Texas, where there is a better availability of workforce. This move is crucial for our growth in the US market. - Mr. Pratik Patel, Chairman and Managing Director.
Q: How do you see the gross margin trend for the upcoming financial year? A: The gross margin took a hit due to specific low-margin projects like the Tata Projects for Nuclear Power Corporation and the Kansas project. These were strategic decisions to secure future business. We expect margins to stabilize as these projects conclude, and we aim for a gross margin range of 55 to 60% going forward. - Mr. Dharmendra Rajain, Chief Financial Officer.