Capitaline

Results 31-May-23

Analysis

Tega Industries

Solid performance

Tega Industries consolidated net sales increased 36.67% to Rs 396.41 crore in Q4FY23 compared to Q4FY22. Sales of consumable segment has gone up 24% to Rs 360.03 crore (accounting for 91% of total sales). Sales of equipment segment was Rs 36.76 crore (accounting for 9% of total sales).

Pursuant to an order pronounced by the Hon`ble National Company Law Tribunal, Kolkata Bench ("Hon`ble NCLT") on 24 February 2023, the company through its wholly-owned subsidiary, Tega Equipments Private Limited ("TEPL"), completed the acquisition of McNally Sayaji Engineering Limited ("MSEL") under the Corporate Insolvency Resolution Process ("CIRP") of the Insolvency and Bankruptcy Code 2016. Vide the same order, Hon`ble NCLT of Kolkata also approved the merger of TEPL with MSEL and consequently MSEL has become a direct wholly-owned subsidiary of the Company. The acquisition had been given effect to in the consolidated financial results. Equipment business represents the operations of a subsidiary company - McNally Sayaji Engineering Limited acquired during the quarter ended 31 March 2023

Profit before interest, tax and other unallocable items (PBIT) rose 49% to Rs 103 crore. PBIT of consumable segment rose 38% to Rs 95.48 crore (accounting for 93% of total PBIT). PBIT of equipment segment stood at Rs 7.52 crore (accounting for 7% of total PBIT).

PBIT margin of consumable segment rose from 23.8% to 26.5%. PBIT margin of equipment segment was 20.5%. Overall PBIT margin rose from 23.8% to 26%.

Operating profit margin has jumped from 23.77% to 25.94%, leading to 49.16% rise in operating profit to Rs 102.83 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 40.35% to 43.27%. Employee cost decreased from 13.23% to 10.86%. Other expenses fell from 21.36% to 19.41%.

Other income fell 46.46% to Rs 6.65 crore. PBIDT rose 34.56% to Rs 109.48 crore. Provision for interest fell 57.97% to Rs 3.19 crore.

PBDT rose 44.08% to Rs 106.29 crore. Provision for depreciation rose 32.38% to Rs 12.06 crore.

Profit before tax grew 45.73% to Rs 94.23 crore. Share of profit/loss was 77.63% higher at Rs 1.35 crore. Provision for tax was expense of Rs 18.32 crore, compared to Rs 16.54 crore. Effective tax rate was 19.17% compared to 25.28%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 58.06% to Rs 77.26 crore.

Equity capital increased from Rs 66.29 crore as of 31 March 2022 to Rs 66.35 crore as of 31 March 2023. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 79.10% as of 31 March 2023 ,compared to 79.17% as of 31 March 2022 .

Full year results analysis

Net sales (including other operating income) of Tega Industries has increased 27.55% to Rs 1213.97 crore. Sales of consumable segment has gone up 24% to Rs 1177.59 crore (accounting for 97% of total sales). Sales of equipment segment was Rs 36.76 crore (accounting for 3% of total sales).

Profit before interest, tax and other unallocable items (PBIT) rose 48% to Rs 270.59 crore. PBIT of consumable segment rose 44% to Rs 263.07 crore (accounting for 97% of total PBIT). PBIT of equipment segment stood at Rs 7.52 crore (accounting for 3% of total PBIT).

PBIT margin of consumable segment rose from 19.2% to 22.3%. PBIT margin of equipment segment was 20.5%. Overall PBIT margin rose from 19.2% to 22.3%.

Operating profit margin has jumped from 19.21% to 22.28%, leading to 47.89% rise in operating profit to Rs 270.42 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 42.36% to 43.53%. Employee cost decreased from 15.05% to 13.39%. Other expenses fell from 23.39% to 20.84%.

Other income fell 14.55% to Rs 20.68 crore. PBIDT rose 40.59% to Rs 291.1 crore. Provision for interest rose 11.85% to Rs 18.12 crore. Loan funds rose to Rs 360.87 crore as of 31 March 2023 from Rs 245.17 crore as of 31 March 2022. Inventories rose to Rs 289.59 crore as of 31 March 2023 from Rs 252.14 crore as of 31 March 2022. Sundry debtors were higher at Rs 403.13 crore as of 31 March 2023 compared to Rs 276.52 crore as of 31 March 2022. Cash and bank balance rose to Rs 49.30 crore as of 31 March 2023 from Rs 40.20 crore as of 31 March 2022. Investments rose to Rs 216.87 crore as of 31 March 2023 from Rs 198.53 crore as of 31 March 2022 .

PBDT rose 43.03% to Rs 272.98 crore. Provision for depreciation rose 6.46% to Rs 41.2 crore. Fixed assets increased to Rs 494.04 crore as of 31 March 2023 from Rs 243.98 crore as of 31 March 2022. Intangible assets increased from Rs 64.49 crore to Rs 66.18 crore.

Profit before tax grew 52.34% to Rs 231.78 crore. Share of profit/loss was 53.19% higher at Rs 4.32 crore. Provision for tax was expense of Rs 52.07 crore, compared to Rs 38.07 crore. Effective tax rate was 22.05% compared to 24.57%.

Minority interest was nil in both the periods. Net profit attributable to owners of the company increased 57.43% to Rs 184.03 crore.

Equity capital increased from Rs 66.29 crore as of 31 March 2022 to Rs 66.35 crore as of 31 March 2023. Per share face Value remained same at Rs 10.00.

Promoters’ stake was 79.10% as of 31 March 2023 ,compared to 79.17% as of 31 March 2022. .

The scrip is currently trading at Rs 899

Tega Industries : Consolidated Results
Particulars	2303 (03)	2203 (03)	Var.(%)	2303 (12)	2203 (12)	Var.(%)
Net Sales	396.41	290.05	37	1213.97	951.76	28
OPM (%)	25.9	23.8		22.3	19.2
OP	102.83	68.94	49	270.42	182.85	48
Other Inc.	6.65	12.42	-46	20.68	24.2	-15
PBIDT	109.48	81.36	35	291.1	207.05	41
Interest	3.19	7.59	-58	18.12	16.2	12
PBDT	106.29	73.77	44	272.98	190.85	43
Depreciation	12.06	9.11	32	41.2	38.7	6
PBT	94.23	64.66	46	231.78	152.15	52
Share of Profit/(Loss) from Associates	1.35	0.76	78	4.32	2.82	53
PBT before EO	95.58	65.42	46	236.1	154.97	52
EO Income	0	0		0	0
PBT after EO	95.58	65.42		236.1	154.97
Taxation	18.32	16.54	11	52.07	38.07	37
PAT	77.26	48.88	58	184.03	116.9	57
Minority Interest (MI)	0	0		0	0
Net profit	77.26	48.88	58	184.03	116.9	57
EPS (Rs)*	#	#		27.7	17.6
Notes
* EPS is on current equity of Rs 66.29 crore, Face value of Rs 10, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

Tega Industries : Consolidated Segment Results
	% of (Total)	2303 (03)	2203 (03)	Var.(%)	% of (Total)	2303 (12)	2203 (12)	Var.(%)
Sales
Consumables	91	360.03	290.05	24	97	1177.59	951.76	24
Equipments	9	36.76	0.00		3	36.76	0.00
Total Reported Sales	100	396.79	290.05	37	100	1214.35	951.76	28
Less: Inter segment revenues		0.38	0.00	-		0.38	0.00	-
Net Sales		396.41	261.89	51		1213.97	951.76	28
PBIT
Consumables	93	95.48	68.95	38	97	263.07	182.86	44
Equipments	7	7.52	0.00	28	3	7.52	0.00	28
Total PBIT	100	103.00	68.95	49	100	270.59	182.86	48
Less : Interest		3.19	7.59	-58		18.12	16.20	12
Add: Other un-allcoable		-4.24	4.06			-16.38	-11.68	40
PBT		95.58	65.42	46		236.10	154.97	52

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