"Headwinds due to high raw materials costs have impacted the business during the quarter. Though sales returned to growth during the quarter, the pick-up has been slower than anticipated."

Performance for the quarter ended September 2017

For quarter ended September 2017, net sales rose 3% to Rs 704.49 crore compared to corresponding previous year period. Operating margins of the company fell 90 bps to 9.1% leading a 7% fall in operating profit to Rs 63.84 crore.

Cost of material consumed as a percentage of net sales (net of stock adjustment) fell 120 bps to 46%. Purchase of stock in trade decreased 50 bps to 9.4%. Employee benefit expenses increased 50 bps to 9.8% while other expenses increased 170 bps to 25.8%.

Other income fell 36% to Rs 8.05 crore. Interest cost increased by 55% to Rs 0.65 crore. Depreciation rose 16% to Rs 15.5 crore. PBT fell 17% to Rs 55.74 crore. Considering 760 bps fall in effective tax rate to 30.4% net profit fell 7% to Rs 38.79 crore.

Performance for half year ended September 2017

For half year ended September 2017, net sales rose 2% to Rs 1419.38 crore compared to corresponding previous year period. However company operating margins fell 280 bps to 9.2% % leading a 21% decrease in operating profit to Rs 130.39 crore.

Cost of material consumed as a percentage of net sales (net of stock adjustment) rose 30 bps to 45.9%. Purchase of stock in trade decreased 10 bps to 11.2%. Employee benefit expenses increased 90 bps to 9.8% while other expenses increased 130 bps to 24%.

Other income fell 41% to Rs 14.82 crore. Interest cost increased by 8% to Rs 1.1 crore. Depreciation rose 14% to Rs 30.16 crore. PBT before EO as a result fell 30% to Rs 113.95 crore. The company had an EO income of Rs 2 crore compared to nil in the corresponding previous year period. PBT after EO was down 29% to Rs 115.95 crore. Considering 440 bps fall in effective tax rate to 31% PAT fell 24% to Rs 80.06 crore.

The scrip is trading at Rs 1860 at BSE