COVID had an impact on our business in March quarter: Shishir Joshipura, Praj Industries

Shishir Joshipura, CEO & Managing Director, Praj Industries, talks about March quarter results and outlook for FY21 among others during a candid chat with Swati Khandelwal, Zee Business. Edited Excerpts:

Praj Industries profit has declined from Rs 33 crore to Rs 25 crore in the March quarter and there was a contraction in the margin. What led to this contraction in EBITDA margin in this quarter?
Impact of COVID-19 was the biggest incident of this quarter, which led to shutting down of our operations from March 15 onwards. Last 15 days of the financial year are very important for project delivery. As far as our international markets are concerned then the impact of COVID has had reached many countries quite before our country. This was creating difficulties in working with the customers in the initial period. These things had an impact on our business in the last 15 days of the financial year. Thus, the numbers for this quarter are not comparable.

See Zee Business Live TV streaming below:

In the last 5 years sales have only grown by 3% CAGR. How do you foresee the sales in the current situation and what will be the guidance for FY21?
I would like to talk about the post-COVID period. The government has earlier announced a very progressive policy, named National Policy on Biofuels and then addressed the issues that came out of it. Perhaps you know that last year a tender of 511 crore litres of ethanol was floated by the Oil Marketing Companies (OMCs) and against the tender, 190 crore litre of ethanol has been supplied to them. Thus, there is a huge gap between demand and supply. This means that there is a need to increase the production capacity and I am sure that this gap will lead to new capacity creation. In addition to this, ethanol has turned into a very important byproduct for sugar companies as it has proved helped them in increasing cash flow in their pockets and cash flow. Thus, sugar mills are very natural owners of ethanol plants.

WATCH

प्राज इंडस्ट्रीज के आय, मुनाफे पर क्यों दिखा दबाव?
कोरोना का कारोबार पर कितना असर और FY21 में कैसी रहेगी कारोबार की ग्रोथ?
जानने के लिए देखिए @PrajIndustries के CEO & मैनेजिंग डायरेक्टर शिशिर जोशीपुरा के साथ स्वाति खंडेलवाल की खास बातचीत।#RoadToRecovery @SwatiKJain pic.twitter.com/UWbNur3cxm

— Zee Business (@ZeeBusiness) May 28, 2020

There have been reports that the government is planning to provide additional soft loans for sugar mills to clear their sugarcane dues. What impact it will have on the sector as well as on your company?
As I have said that the government has announced progressive policies in India and I think that these policies will lead to capacity creation in this sector in the coming future. The incentive that is being provided by the government will help in increasing the viability of the projects. I expect that similar policies will be announced for biogas in recent future. And, we are also seeing constructive progress in several international markets as well.