• Operational income (excluding other operating income) was lower by 14% to Rs 476 crore but the value of production was lower by 11% to Rs 494.43 crore. Sales lower than value of production reflects inventory built up which will get liquidated in coming months. The other operating income was lower by sharp 35% (to Rs 12.24 crore). Thus the overall sales were higher by 15% to Rs 488.24 crore.

• The operating profit margin expanded by 360 bps to 29.4%. Thus the impact of lower sales was restricted at the level of operating profit, which was down by 3% to Rs 143.45 crore.

• Expansion in operating margin was largely on account of lower material cost. Material cost (as % to sales net of stocks) was lower by 470 bps to 35.1%. Even though the staff cost was higher by 90 bps (to 4.9%) and other expenses was up by 110 bps (to 31.7%) that is not good enough to completely offset the gain in material cost.

• Other income was lower by 40% to Rs 11.96 crore. Interest cost stand lower by 12% to Rs 0.95 crore. Similarly the depreciation stood higher by 22% to Rs 16.88 crore. Thus the de-growth at PBT (before EO) was down by 5% to Rs 137.58 crore. EO for the period as well as corresponding previous period was nil. Thus the PBT (after EO) was lower by 5% to Rs 137.58 crore.

• The taxation in absolute terms was up by 20% to Rs 44.05 crore and the tax rate was higher at 32.0% compared to 25.3% in the corresponding previous period. Thus the PAT was down by 14% to Rs 93.53 crore. The minority interest was lower by 76% to Rs 0.05 crore. And thus the net profit (after MI) was lower by 13% to Rs 93.48 crore.

The consolidated financial results of AIA Engineering comprises of the results of the parent company i.e. AIA Engineering and its subsidiaries viz. Bangalore based Welcast Steels, UAE based Vega Industries (Middle East) F.Z.E., UK based Vega Industries, USA based Vega Industries, South Africa based Vega Steel Industries (RSA) Pty, and China based Wuxi Weigejia Trade Company.

Half yearly performance

Consolidated sales were lower by 5% to Rs 1013.36 crore. With OPM expand by 300 bps to 28.8%; the operating profit was higher by 6% to Rs 291.47 crore. After accounting for lower other income, higher interest and higher depreciation, the PBT was up by 1% to Rs 286.27 crore. The EO was nil for the period as well as corresponding previous period. Taxation was higher by 13% (to Rs 89.88 crore) in absolute terms and the tax rate was lower at 31.4% compared to 28.0% in corresponding previous period. Thus the PAT was lower by 4% to Rs 196.39 crore. Eventually after accounting for lower MI (a share of profit at Rs 0.08 crore, down 80%), the net profit (after MI) was down by 3% to Rs 196.31 crore.

The stock hovers around Rs 920.45.