India Nippon Electricals is joint venture between Lucas Indian Service, a wholly-owned subsidiary of Lucas-TVS and Kokusan Denki Co., Japan - a group company of Hitachi Japan. It manufactures entire range of digital and analog ignition products for two/three wheelers and portable engines.

Quarterly Performance

For the fourth quarter ended March 2017, the company has reported 4% drop in the total income from operations at Rs 81.84 crore.

For the quarter, the raw material cost as % of sales net of stock adjustments decreased by 520 bps at 66.8%. The employee cost rose 70 bps to 12.9% during the quarter. Other expenses rose 500 bps to 10.9%. Resultantly, Operating margins fell 110 bps to 8.7%. Operating profit stood 14% lower atRs 7.13 crore.

With 25% rise in other income to Rs 3.32 crore, PBIDT decreased by 5% to Rs 10.45 crore. Interest cost fell by 75% to Rs 1 lakh. Depreciation cost decreased by 27% at Rs 1.04 crore. Thus, PBT decreased by 1% to Rs 9.4 crore. After considering 1400 bps increase in the effective tax rate at 35% (65% rise in tax provison), Net Profit fell 19% at Rs 6.11crore.

Annual Performance:

For the year ended March 2017, the company has reported 4% rise in the total income from operations at Rs 349.96 crore.

For the period, the raw material cost as % of sales net of stock adjustments decreased by 270 bps at 66.9%. The employee cost rose 50 bps to 12.9% during the period. Other expenses rose 160 bps to 9.9%. Resultantly, Operating margins rose 20 bps to 10.8%. Operating profit stood 6% higher at Rs 37.69 crore.

With 36% rise in other income to Rs 13.62crore, PBIDT increased by 12% to Rs 51.3 crore. Interest cost fell by 54% to Rs 6 lakh. Depreciation cost was steady at Rs 4.17 lakh. Thus, PBT increased by 14% to Rs 47.08 crore. After considering 517 bps increase in the effective tax rate at 31.2% (37% rise in tax provision), Net Profit rose 6% at Rs 32.4 crore.

The scrip closed 3.6% lower at Rs 635.65 at BSE on 19 May 2017, a day after earnings were announced.