Shares of Sanghvi Movers hit a six-month low at Rs 800.10, as they slipped 10 per cent on the BSE in Thursday’s intra-day trade extending its fall after the company reported a weak set of numbers for the June 2024 quarter (Q1FY25).
In the past one week, the stock has tanked 32 per cent. It was trading at its lowest level since February 2, 2024. The market price of Sanghvi Movers nearly halved or plunged 46 per cent from its 52-week high of Rs 1,483 hit on May 16, 2024.
In Q1FY25, Sanghvi Movers net profit was down 2.7 per cent at Rs 40.60 crore against Rs 41.74 crore in a year ago quarter (Q1FY24), due to higher operating expenses. Income from operations grew 3 per cent year-on-year at Rs 150.61 crore against Rs 146.07 crore.
Increase in operating expenses in Q1FY25 was primarily on account of increase in sub-contracting charges because of engineering, procurement, and construction (EPC) business. The average capacity utilization of crane fleet dropped from 84 per cent in Q1FY24 to 77 per cent in Q1FY25 primarily on account of better than predicted monsoon & slowdown due to general elections.
In Q1FY25, the financial performance of the company was affected on account of reduction in capacity utilization (CU) and consequent reduction in the blended average yield.
The management expects similar kind of business outlook and subdues financial performance of the company in Q2FY25 and expect further drop in CU (below 75 per cent) and average blended yield (below 2 per cent).
The management said the company has a better visibility of crane deployment post monsoon i.e. H2FY25 and have healthy pipeline and serious enquires from its key customers. The company expect business volume, CU and Yield to pick up in H2FY25 and CU and Yield is expected to cross beyond 80 per cent and 2 per cent respectively in H2FY25.
With continued Government focus on infrastructure development, demand for cranes has increased and is expected to remain buoyant over the medium term. The wind sector is the major contributor to Sanghvi Mover’s revenue and ICRA expects around 4.0-GW wind capacity addition in FY2024. Apart from the wind sector, SML has presence across various other industries such as steel, cement, etc, which are looking at healthy capacity addition in the near to medium term, which augurs well for its growth potential.
The company’s fleet comprises over 346 medium to large-sized heavy-duty telescopic and crawler cranes, with capacities ranging from 20 to 1,600 MT, operating across 130+ job sites nationwide. Sanghvi Movers supports various industrial sectors, including power, steel, cement, fertilisers, petrochemicals and refineries, metro railways, and the wind power sector. Additionally, Sanghvi Movers has over 100 high-bed trailers and 100 multi-axle lines for efficient equipment transportation.
Sanghvi Movers primarily provides medium to heavy duty cranes on rental basis to various private and public sector undertakings. The company had a total fleet size of 346 cranes having a cumulative lifting capacity of 81,288 MT as on March 31, 2024. The company’s crane fleet consists of medium to large size hydraulic truck mounted telescopic and lattice boom cranes and crawler lattice boom cranes having lifting capacity from 20 MT to 1,000 MT. Almost all the cranes are imported from Germany, USA, UK, Japan, China, and Singapore.
First Published: Aug 08 2024 | 2:15 PM IST
