Capitaline

Analyst Meet / AGM 05-May-18

Conference Call

Castrol India

Expects its volume growth to be ahead of the market growth

Castrol India conducted conference call to discuss the financial results and performance of the company for the quarter ended March 2018. Managing Director Omer Dormen and Director Finance & Chief Financial Officer Miss Rashmi Joshi addressed the call
Highlights of the Concall

Castrol India reported 2% increase in its bottom-line to Rs 181.8 crore in Q1CY'18 on 5% increase in topline to Rs 927.1 crore compared to corresponding previous year period driven by volume growth across categories.

Volume growth in personal mobility segment (passenger Car Motor Oils-PCMO) and commercial vehicle operation (CVO) segment was a respectable single digit growth while Industrial segment volume growth was under pressure.

The company is consistently growing its volume for last 9 quarter except on GST quarter

Net realisation was lower on a YoY basis due to GST adjustments but on a like to like basis it was higher by 5%. On a QoQ basis realizations were also lower to support volumes.

Power brands contributed around 50% of the volume.

Castrol India launched several new products during Q1CY18.

In the fast growing passenger car segment, Castrol India launched Castrol MAGNATEC engine oil with DUALOCK technology, specially designed to provide 50% better engine protection especially in congested city driving conditions.

In the commercial vehicle segment, Castrol CRB Turbomax with DuraShield boosters was launched which delivers up to two times longer engine life.

Castrol India continued to build strategic OEM partnerships and signed a three-year contract with Ford India to supply engine and transmission oils for all Ford vehicles produced in India for domestic and international markets.

Castrol India's Silvassa Plant was awarded the prestigious Q1 certification by Ford - the first lubricants plant in India to receive this award.

The company expects further volatility in the cost of goods with the continued increase in crude oil price and depreciation of the Indian rupee.

Castrol India continues to remain optimistic about the Indian lubricant market and is confident about continuing to deliver robust business performance aligned to its long term strategy

Advertisement expense was 3% of total sales in Q1CY18 and 20% higher on a YoY basis

The company expects its volume growth to be ahead of the market growth

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