Highlights of the call:

For the quarter ended June 2014, Suprajit Engineering registered a good 30% rise in consolidated sales to Rs 141.27 crore. OPM improved 10 basis points to 14.3% which lifted OP 32% to Rs 20.23 crore.

PBT grew 18% to Rs 15.76 crore.

PAT grew 19% to Rs 10.66 crore.

The company has won "GM's Supplier Quality Excellence Award" for the third year in a row. The company has been receiving several awards but its good to receive it three times in a row from GM.

Automotive and non-automotive exports business out performed with a robust growth during the quarter.

Construction activity for plant expansion is in full swing at the Pathredi Plant of the company.

Revenue mix:

2 Wheeler accounted for 54% against 55% in June 2013 quarter.

Non-2-wheeler Automotive accounted for 31% against 29% in June 2013 quarter.

Non Automotive accounted for 6% against 5% in June 2013 quarter.

After market accounted for 9%.

Overall global business grew from 14% to 18%. Domestic business stood at 82% in June 014 quarter. Around 7-8 years ago the same stood at 1%.

HMSI is in talks with the company to set up a plant close to its plant in Gujarat and the company is giving serious thought.to it.

Wage cost has increased due to increase in minimum wage. This has been across all states. This has impacted the margins.

Q1 is worst for the company, Q3 is the best, Q2 is second worse and Q4 is second best.

Other income is coming down because the company has not booked its growth option in the debt fund.

Export is gaining traction. Exports are driving subsidiary numbers.

Exports in Q1 grew 60% even though on a small base.

Break up of exports:

Non auto business

70% was to US.

20% to Europe

10% Japan.

Auto business

60% to Europe

30% to North America

10% Rest.

Cable business is 95% and rest is non cable business.

The company has capex plans of Rs 65 crore till March 2016 for its three plants. Capacity will increase from current 150 million to 200-225 million after capex.

However due to various steps taken the capacity will increase to around 160 million by September 2014 and 170 million by the end of FY 2015.

The management does not give guidance but said it will beat Industry growth. In June 2014 quarter it grew by 30% while industry grew by 12%. The management feels it is possible to grow in double digits this year.

Margins in exports are around 100 basis points higher than domestic sales. Margins is expected to be same going forward.

Non auto business has higher margins because of its niche products. But this is a very small part of the overall business. Non auto margins can witness improvement in its margins.

Total global automotive cable business would be around 3 billion dollars. Non auto business could be around 200-300 million (the management is not sure about the numbers of non auto cable business).