During Monday’s trading session, the shares of a clean energy solutions company and a leading global manufacturer of seamless steel gas cylinders surged nearly 18.5 percent to Rs. 195.7 on BSE, after reporting a rise in net profit by nearly 38 percent QoQ and 47 percent YoY in Q2 FY25.
With a market cap of Rs. 2,158.3 crores, at 11:18 a.m., the shares of Everest Kanto Cylinder Limited were trading in the green at Rs. 192.35, up by nearly 16.4 percent, as compared to its previous closing price of Rs. 165.2.
What’s the news:
The fluctuations in the share prices were observed after Everest Kanto Cylinder (EKC) Limited announced the financial results for Q2 FY25, through the recent filings with the stock exchanges.
For Q2 FY25, EKC reported revenue from operations of Rs. 367.3 crores, reflecting a significant growth of around 7.2 percent QoQ from Rs. 342.8 crores in Q1 FY25, and increased by about 23 percent YoY from Rs. 299.3 crores in Q2 FY24.
The growth in revenue was fueled by a consistent rise in demand across both domestic and international markets. The CNG segment saw a year-on-year increase in sales volume, significantly contributing to the overall performance. India and the USA reported year-on-year growth of 31 percent and 27.9 percent, respectively.
The company’s net profit for Q2 FY25 grew to Rs. 38.6 crores, representing a rise of around 38 percent QoQ from Rs. 28 crores in Q1 FY25, and a year-on-year growth of nearly 47 percent from Rs. 26.3 crores in Q2 FY24.
The consolidated EBITDA for Q2 FY25 stood at Rs. 53.1 crores, reflecting about a 29 percent YoY increase from Rs. 41.3 crores in Q2 FY24, while the EBITDA margin improved significantly, rising from 13.8 percent to 14.5 percent, over the same period.
The consolidated EBITDA improved due to higher sales and operational efficiencies, supported by strong performance in the USA markets.
Looking ahead, the advanced manufacturing facilities in Egypt and Mundra, India, are progressing as planned and are expected to become operational in the upcoming quarters.
Key Updates in Q2 FY25:
In July 2024, the introduction of the world’s first CNG motorcycle by a leading bike manufacturer created a new demand vertical for the CNG cylinder industry, expanding market opportunities for the company. EKC is supplying CNG cylinders for this innovative bike.
In August 2024, EKC International FZE supported Alfa Designs Nigeria Ltd. in achieving Nigeria’s first CNG generator conversion by supplying CNG cascades for this project.
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Shareholding Pattern:
As per the September 2024 shareholding pattern, the Promoters hold a 67.38 percent stake in the company, Foreign Institutional Investors (FII) hold a 1.4 percent stake, while Retail Investors and Domestic Institutional Investors (DII) hold a 31.16 percent and 0.07 percent stake in EKC, respectively.
Stock Performance:
The stock has delivered positive returns of nearly 33.4 percent in one year, as well as around 36.2 percent returns in the last six months. So far in 2024, the shares of Everest Kanto Cylinder have given positive returns of about 50 percent.
About the company:
Everest Kanto Cylinder Limited is engaged in the manufacturing of high-pressure seamless gas cylinders and other cylinders, equipment, appliances and tanks with their parts and accessories, used for containing and storage of natural gas and other gases, liquids and air.
Established in 1978, the company is also engaged in the business of trading fire extinguishment and related equipment and castor oil.
EKC operates two manufacturing facilities in India located at Tarapur (Maharashtra) and Kandla SEZ (Gujarat) and two international facilities at Jebel Ali Free Zone in Dubai and Pittsburgh (PA), USA, with an aggregate capacity of about 1.5 million cylinders annually.
Its product range of industrial, CNG and jumbo cylinders is used for high pressure storage of gases such as oxygen, hydrogen, nitrogen, argon, helium, air etc., and finds applications in a wide variety of industries such as manufacturing, fire equipment/suppression systems, medical establishments, aerospace/defence and automobiles apart from some specialized usage areas.
Written by Shivani Singh
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