• Sales were higher by 6% to Rs 827.52 crore. However the value of production for the quarter was up by 6% to Rs 818.21 crore. Sale for the quarter and corresponding previous period was 1.01% higher than their respective value of production. Sales higher than value of production for the quarter reflects liquidation of earlier period inventory.

• Operating profit margin expanded by 130 bps to 18.2% and this can be attributed to fall in material cost. Material cost (including cost of traded goods) as proportion to sales net of stocks was lower by 130 bps to 50.6%. However the staff cost and OE was flat at 16.9% and 14.1% respectively. Thus gained by higher sales and higher OPM the operating profit was up by 14% to Rs 150.52 crore.

• Other income was up by 23% to Rs 26.13 crore. However the interest cost was up at Rs 1.36 crore compared to nil in corresponding previous period. And the depreciation cost was up by 127% to Rs 8.74 crore. Thus the growth at PBT was up by 11% to Rs 166.55 crore.

• Taxation in absolute term was down by 12% to Rs 46.34 crore and the effective tax rate for the quarter was lower at 27.8% compared to 35.1% in the corresponding previous period. Thus the PAT stood higher by 23% to Rs 120.21 crore.

• The Company has computed the tax expense of the current financial year as per the tax regime announced under section 115BAA of the Income Tax Act, 196t .Accordingly, the company has recognized Provision for lncome Tax for the six months ended September 30, 2019 and re-measured its Deferred Tax Assets based on the rate prescribed in the said section. The full impact of this change has been recognized In the Statement of Profit and Loss for quarter ended September 30, 2019.

Effective April 1, 2019, the company adopted Ind AS 116 Leases and applied the standard to all lease contracts existing to that date using the modified retrospective method, recognizing the cumulative effect of initially applying this standard as an adjustment to Right-Of-Use Assets as on April 1, 2019. Accordingly, comparatives for the year ending or ended March 31, 2019 are not retrospectively adjusted or restated. Further transition adjustments, if any, arising from refinements or authoritative Interpretation guidance are recognized prospectively.

Half yearly performance

Sales for the period were up by 8% to Rs 1684.55 crore. Higher sales together with 260 bps expansion in OPM to 18.9% have facilitated 26% growth in operating profit to Rs 319.21 crore. However the growth at PBT level was restricted at 18% to Rs 343.17 crore, dragged by lower other income, higher interest and depreciation cost. But the PAT was eventually up by 24% to Rs 234.31 crore as effective tax rate decline to 31.7% compared to 35.1% in the corresponding previous period.

The stock closed Oct 25, 2019 at Rs 28750.65.