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Net sales of Castrol India have increased 65.51% to Rs 1,138.70 crore. Operating profit margin has jumped from 25.15% to 29.87%, leading to 96.59% rise in operating profit to Rs 340.10 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 43.87% to 41.50%. Purchase of finished goods cost rose from 3.99% to 4.62%. Employee cost decreased from 7.13% to 4.40%. Other expenses fell from 22.03% to 19.59%. Other income fell 27.78% to Rs 14.3 crore. Provision for interest fell 45.45% to Rs 0.6 crore. Provision for depreciation was down 3.15% to Rs 21.5 crore. Profit before tax grew 96.05% to Rs 332.30 crore. Provision for tax was expense of Rs 88.7 crore, compared to Rs 44.3 crore. Effective tax rate was 26.69% compared to 26.14%. Profit after tax rose 94.57% to Rs 243.60 crore.
Promoters' stake was 51.00% as of 31 March 2021, compared to 51.00% as of 31 March 2020.
For CY'20 Net Sales of the company was down 23% to Rs 2996.9 crore compared to corresponding previous year while bottomline decreased 30% to Rs 582.9 crore. OPM fell 190 bps to 27.8% leading a 28% fall in operating profits to Rs 833.6 crore. Other income decreased 4% to Rs 62 crore while interest cost was Rs 4.2 crore and depreciation was up 24% to Rs 86.6 crore. PBT before EO as a result fell 30% to Rs 804.8 crore. The company reported EO expense of Rs 16.8 crore towards one time organization transformation and restructuring programme implemented during the year compared to nil in the corresponding previous year period. PBT after EO fell 32% to Rs 785.3 crore. Effective rate of taxes fell 210 bps to 25.8% leading a 30% decrease in PAT to Rs 582.9 crore.
Sandeep Sangwan, Managing Director, Castrol India Limited:
"Castrol India Limited reported a strong financial delivery in 1Q 2021 building on a resilient second half performance for FY 2020. We delivered robust revenue and profit growth with 1Q revenue from operations @ INR 1139 crores (66% higher) and 1Q Profit Before Tax @ INR 332 crores (96% higher) versus 1Q 2020 which saw the onset of the Covid-19 pandemic and resultant business slow down beginning March 2020.
Focused investments, interventions and actions taken in the second half of 2020 towards brand building with increased marketing and advertising spends, new product introductions as well as
corrective pricing have yielded a positive impact on overall topline growth. This has been aided by improving demand trends especially in tractor and SUV sales in 1Q 2021.
Strengthening our network and expanding our footprint, as well as building our participation in digital market platforms, we entered into a strategic collaboration with ki Mobility Solutions Private Limited to supply lubricant products to ki Mobility workshops in India and also be available on goBumpr, their digital platform.
Our cost efficiency programmes and judicious working capital management efforts led to healthy cash from operations @ INR 269 crores in the quarter, which is equivalent to 1.1 times of Profit After Tax.
While we continue to focus on fundamental building blocks to deliver sustainable profitable growth keeping safety of our teams as our top priority, our plants continued to operate safely deploying Covid-19 safety processes and guidelines as laid out by local governments. Our Patalganga plant won recognition from the National Safety Council for the second consecutive year for its strong safety performance.
The second wave of the Covid-19 pandemic in India is resulting in a market slowdown in various parts of the country. In addition, supply disruptions on account of base oil and raw materials
availability, logistics challenges and rupee depreciation are likely to adversely impact demand and supply. The management is keeping a close watch on the situation and responding with appropriate actions as needed."
The scrip is currently trading around Rs 129 on the BSE
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