October 27, 2022

BSE Limited

National Stock Exchange of India Limited

Phiroze Jeejeebhoy Towers,

Exchange Plaza,

Dalal Street, Fort,

Bandra Kurla Complex, Bandra (East),

Mumbai 400001

Mumbai 400051

Scrip Code: 532504

Symbol: NAVINFLUOR EQ

Dear Sir / Madam,

Sub.: Transcript of Earnings Call of Q2 FY 2022-23

Pursuant to Regulation 30 read with Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the transcript of the Company's Earnings Call held on October 20, 2022 regarding discussion on operational and financial performance for the quarter ended September 30, 2022 (Q2 of FY 2022-23) is enclosed.

This intimation is also being made available on the Company's website at www.nfil.in.

Request you to take this intimation on record.

Thanking You,

Yours faithfully,

For NAVIN FLUORINE INTERNATIONAL LIMITED

NIRAJ MANKAD

Digitally signed by

NIRAJ MANKAD Date: 2022.10.27 19:02:19 +05'30'

Niraj B. Mankad

President - Legal and Company Secretary

Encl.: a/a

Navin Fluorine International Limited 602, 6th Floor, Natraj by Rustomjee, 194, M.V. Road & Western Express Highway, Near Kanakia 351 Building, Andheri (East), Mumbai 400069 India. T: +91 22 6650 9999 F: +91 22 6650 9800 E: info@nfil.in W: www.nfil.in

CIN: L24110MH1998PLC115499

"Navin Fluorine International Limited Q2 FY23

Earnings Conference Call"

October 20, 2022

MANAGEMENT: MR. RADHESH WELLING - MANAGING DIRECTOR MR. PARTHA ROYCHOWDHURY - INTERIM CFO, CEO

  • HPP BUSINESS

MODERATOR: MS. RASIKA SAWANT - ORIENT CAPITAL

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Navin Fluorine International Limited

October 20, 2022

Moderator:

Good morning ladies and gentlemen. Welcome to the Navin Fluorine International Limited Q2

FY23 earnings conference call.

As a reminder, all the participants' lines will be in the listen-only mode and there will be an

opportunity for you to ask questions after the presentation concludes. Should you need assistance

during the conference call, please signal the operator by pressing '*' then '0' on your touch-tone

phone. Please note that this conference is being recorded.

I now hand the conference over to Ms. Rasika Sawant from Orient Capital. Thank you and over

to you, Ma'am.

Rasika Sawant:

Welcome to the Q2 and H1 FY23 earnings conference call. Today, on this call, we have Mr.

Radhesh Welling - Managing Director of Navin Fluorine International Limited along with the

senior management team.

This conference call may contain forward-looking statements about the Company which are

based on beliefs, opinions and expectations as of today. Actual results may differ materially.

These statements are not the guarantees of future performance and involve risks and

uncertainties that are difficult to predict. A detailed safe harbor statement is given on page #2 of

the investor presentation of the Company, which has been uploaded on the stock exchange and

Company's website as well.

With this, I now hand over the call to Mr. Radhesh Welling for his opening remarks. Over to

you, Sir.

Radhesh Welling:

Good morning and a warm welcome to all the participants. On this call today, I am joined by

Mr. Partha Roychowdhury and our investor relations partner, Orient Capital. As you all know,

Partha joined Navin Fluorine as the CEO of our High-Performance Products business. He has

also been assisting me and the finance team in the interim, as we interview candidates for the

CFO position. I hope all of you got an opportunity to go through our financial results and investor

presentation which have been uploaded on the stock exchange as well as on the Company's

website.

Before my comments on the business performance, I would like to brief you on a few key

developments at Navin Fluorine. It gives me pleasure to inform you that the commercial

production at the plants set up to manufacture and supply new hydrofluoroolefins has started

post successful supply of commercial trials to the customer. The customer has validated the

product specifications for the requisite batch quantities on agreed parameters. This plant is under

our wholly owned subsidiary, Navin Fluorine Advanced Sciences Limited in Dahej, Gujarat.

Also, 2 additional new plants in Dahej are scheduled to start in Q3 FY23. Commercial

production in MPP will start in a phased manner while production in the dedicated plant for

agrochemical customer will start in the month of December. Debottlenecking project for our

cGMP3 plant in Dewas is well underway and is scheduled to get completed as per plan.

Page 2 of 17

Navin Fluorine International Limited

October 20, 2022

It gives us pleasure to inform you all that the Board of Directors has declared an interim dividend of Rs. 5 per equity share of the face value of Rs. 2 each for financial year '23 at the Meeting held yesterday.

Now, I would like to discuss the operating performance of each business unit. Our Specialty business continues to deliver strong performance driven by strong partnerships. All 3 verticals - crop science, pharma, and Industrial- have delivered good results. We achieved record quarterly revenue in this business unit for this quarter and reported revenue growth of 46% on YoY at Rs. 177 crores for Q2 FY23. This business continues to see development of a rich pipeline of differentiated business opportunities. As mentioned earlier, we are focused on commercialization of 2 new projects in H2 of FY23.

Our HPP business grew by 76% in Q2 FY23 to Rs. 211 crores compared to the same period last year. This also includes revenue from NFASL which comes from the newly commissioned plant at Dahej for manufacture and supply of the new HFO molecule.

Our legacy business also saw a combination of strong growth as well as price increases. International business contributed about 46% whereas the balance 54% is from our domestic operations.

Our CDMO business reported revenue of Rs. 39 crores through FY23. As I had indicated earlier, our calendar year 2022 looked soft, which is also reflected in our Q2 performance. But overall, we remain quite confident of our growth in our CDMO business. Work on the business plan for cGMP4 is ongoing, and we expect to take this to the Board towards the end of the current financial year.

This quarter, we successfully completed important plant audits of 2 large pharma innovators. Also, we received a relatively large purchase order of $16 million molecule for a late-stage clinical trial. Supply for this molecule is to happen over 2 quarters in calendar year 2023, and we are currently discussing with the customer for the specific dates for the delivery of this molecule.

Now I would like to share the highlights of our financial performance following which we will be happy to respond to your queries. For H1 FY23, on a consolidated basis, the Company has reported net revenue from the operations of Rs. 817 crores as against Rs. 665 crore in H1 FY23 with a growth of 23%. Operating EBITDA stood at Rs. 193 crores as against Rs. 162 crore in H1 FY22, up by 19%. Operating EBITDA margin stood at 23.6% as against 23% in same period last year.

As mentioned earlier, we commercialized a new plant in Dahej in the last quarter, which impacted the overall margins, which was operational in August 2022. On a standalone basis, NFIL delivered a margin of around 25%.

Page 3 of 17

Navin Fluorine International Limited

October 20, 2022

The operating PBT was up 16% and stood at Rs. 159 crores for H1 FY23 as against Rs. 137 crores last year. Operating PBT margin was at 19.4% in FY23. Profit after tax stood at Rs. 132.3

crores for H1 FY23 and PAT margin was at about 16.2%.

Now coming to the quarterly performance for Q2 FY23, the Company reported a growth of 24%

in net revenue from operations to Rs. 419 crores against Rs. 339 crores in Q2 FY22. The

operating EBITDA grew by about 11% to Rs. 94 crores as against Rs. 84 crores in Q2 FY22.

Margins stood at 22.4% for Q2 FY23. Operating PBT stood at 17.2% at Rs. 72 crores. PAT

stood at Rs. 57.8 crores for Q2 FY23 as against Rs. 63.2 crores in Q2 FY22.

I think I have covered most of the basic information around the business and financial

information. We now open the floor for Q&A.

Moderator:

Ladies and gentlemen, we will now begin with the question & answer session. We will wait for

a moment while the question queue assembles. The first question is from the line of Sudarshan

Padmanabhan from JM PMS. Please go ahead.

Sudarshan Padmanabhan: I have 3 questions. My first question is on the HFO supplies to Honeywell. If I look at the standalone minus consol, we are looking at around Rs. 30 crores to Rs. 35 crores. I understand that you earlier said that the ramp-up would be slow. But if you can give some color on how one should expect the ramp-up to happen, say over the next 4 quarters to 6 quarters.

The second question is on the CDMO side. While I agree or understand that this is a little bit lumpy in the nature and we have a fair amount of tailwinds that is there in terms of interest as well as execution, is there any kind of a shipment delay that would have resulted in non-booking of certain contracts in this quarter and should be basically bunched up in the third quarter? Or how should one look at say the next 3 to 4 quarters in terms of the build-up?

And finally on the cost side. The other cost seems to be on the higher side. Just to understand whether largely the other cost reflects the upfront cost on the new capacities or is there any one- offs?

Radhesh Welling:On HFO, we are actually being a relatively strong demand from the market. If you look at the quarter - we are talking about Q2, and again, going forward Q3, Q4 - we believe that at least from the demand side, we should basically be running the plant close to optimum capacity. One of the challenges that we faced last month was in availability of one of the critical raw materials for which one of our suppliers actually has a new plant and that project had got significantly delayed. That plant was supposed to be ready by December of last year; it just got ready; because of which, we actually didn't get all the raw materials that we actually need to manufacture.From the demand side, the demand continues to remain pretty strong.

Again, from the manufacturing side, we believe that we are in a position to ramp up to almost close to full capacity. And from the quality side also, we have actually been able to get the

Page 4 of 17

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Navin Fluorine International Limited published this content on 27 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 October 2022 17:29:04 UTC.