• Operational sales was higher by 30% to Rs 365.80 crore but the value of production was higher by 25% to Rs 356.40 crore. Sales higher than value of production reflects liquidation of prior period inventory.
• Upside in revenue was largely due to strong growth across all business of the company. While the sales of pumps was higher by 32% to Rs 315.50 crore (or 81% of sales) and that of valves was up by 20% to Rs 50.50 crore (or 13% of sales). The segment revenue of others was higher by 31% to Rs 25.90 crore.

• Lower OPM to the extent of 80 bps was largely due to higher material cost as well as cost of traded goods. Material cost as % to sales was higher by 200 bps to 48.8%. Similarly the cost of traded goods was up by 120 bps to 7%. On the other hand the staff cost and other expenses was lower by 150 bps (to 12.3%) and 140 bps (to 21%) respectively. Though staff cost and OE stood lower that is not good enough to fully offset the rise in material cost including cost of traded goods. Thus restricted by lower OPM, the operating profit was up by 21% to Rs 38.70 crore largely due to higher sales.

• EBIT was up by 34% to Rs 33.30 crore. Upside at EBIT level was largely on account of pump business. Pump business facilitated by higher sales and 40 bps expansion in segment margin to 9.5% has seen its segment profit expand by 38% to Rs 30 crore. On the other hand despite higher sales, the segment profit of valves was down by 6% to Rs 2.90 crore hurt by 160 bps contraction in its segment margin to 5.7%. The segment profit of others was a profit of Rs 0.40 crore compared to a loss of Rs 0.10 crore in the corresponding previous period.

The Group elected to exercise the option permitted under section 115BAA of IT Act 1961 as introduced by the Taxation Law (amendment) ordinance 2019. Accordingly the group has recognized provision for income tax for the nine month ended Sep 2019 and re measured its deferred tax basis in accordance with the prescribed rate. The full impact of this change has been recognized in the quarter ended Sep 2019.

Sales were higher by 28% to Rs 956.90 crore and with OPM contract by marginal 10 bps (to 10.7%) the operating profit was up by 27% to Rs 102.60 crore. After accounting for higher other income, higher interest and higher depreciation, the PBT was up by 31% to Rs 83 crore. Taxation was up 46% to Rs 30.90 crore and thus the PAT was higher by 54% to Rs 64.80 crore. After accounting for higher share of profit from associate, the net profit was up by 52% to Rs 68.10 crore.

The stock hovers around Rs 709.