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Lakshmi Machine Works (LMW) has reported moderate 7% growth in Net Profit at Rs 49.24 crore over 31% increase in the total income from operations at Rs 581.39 crore for the quarter ended September 11. While operating margins improved on q-o-q basis, it was still lower by 230 bps on y-o-y basis at 15.3%. Textile machinery division witnessed some pressure on pricing terms and reported marginal 6% increase in the Segment profit at Rs 54.96 crore while the Machine Tools and foundry segment reported robust results.
Quarterly Performance
For the quarter ended September 11, LMW has reported 31% increase in total income from operations at Rs 581.39 crore, mainly on the back of 21% increase in the revenues from textile machinery division which contributed 85% of the total revenues. On the other hand, Machine tools and foundry business has also reported strong 48% growth to Rs 88.26 crore and constituted remaining 15% of the revenues.
Raw material cost as % of sales net of stock adjustments has zoomed 280 bps to 60.1% on the back of spike in pig iron and steel cost. Other expenditure heads reported marginal decline. On the segment front, Textile Machinery division segment margins slipped by whooping 340 bps to 11.1% while that of machine tools and foundry improved to 9.4% in quarter under review. Thus OPM was under pressure and slipped 230 bps to 15.3%. The other income declined 25% to Rs 11.40 crore and led PBIDT up 8% to Rs 100.25 crore.
At segment level, profit from textile machinery division has inched 6% to Rs 54.96 crore while that of Machine tool and foundry has surged 166% to Rs 8.25 crore. As a debt free company, the company enjoyed nil interest cost. But depreciation inched up 11% to Rs 28.01 crore and led PBT up 7% to Rs 72.24 crore. Finally 50 bps dip in effective tax rate at 31.8% has resulted Net Profit up 7% to Rs 49.24 crore.
Half Yearly Performance
For the half year ended September 11, the company has reported 19% increase in Net Profit at Rs 90.38 crore over 39% increase in total income from operations at Rs 1092.53 crore. OPM slipped 230 bps to 14.6% owing to the decline in segment margins of textile machinery division by 160 bps. This division has reported 17% growth in segment profit at Rs 97.29 crore and constituted 88% of total segment profit.
Other Information
- Consequent upon acquisition of 50% stake in JV Rieter LMW Machinery, the same has become wholly owned subsidiary with effect from 16 August 11 and the name has been changed to LMW Machinery Limited.
- The promoter's stake has increased from 25.82% a year ago to 28.34% at end of September 11.
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