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Castrol India reported 32% decrease in its bottom-line to Rs 125.2 crore in Q1CY'20 on 30% decrease in topline to Rs 688 crore compared to corresponding previous year period. OPM was down 390 bps to 25.1% leading to a 39% fall in operating profits to Rs 173 crore as cost of material consumed as a percentage of net sales increased 320 bps to 43.9% in the quarter ended Mar20 from 40.7% in the corresponding previous year period while employee benefit expenses rose 200 bps to 7.1%, other expenses rose 300 bps to 22% and purchase of stock in trade fell 230 bps to 4%.
Other Income decreased 6% to Rs 19.8 crore in Q1CY20 from Rs 21.1 crore in Q1CY19 while interest cost was Rs 1.1 crore and depreciation rose 37% to Rs 22.2 crore. As a result PBT was down 41% to Rs 169.5 crore. Effective rate of tax fell 950 bps to 26.1% leading a 32% decrease in PAT to Rs 125.2 crore.
For CY'19 Net Sales of the company was down 1% to Rs 3876.8 crore compared to corresponding previous year while bottomline increased 17% to Rs 827.4 crore. OPM rose 230 bps to 29.7% leading a 8% rise in operating profits to Rs 1153 crore. Other income decreased 23% to Rs 64.8 crore while interest cost was Rs 1.2 crore and depreciation up 25% to Rs 69.7 crore. PBT as a result rose 4% to Rs 1146.9 crore. Effective rate of taxes fell 760 bps to 27.9% leading a 17% increase in PAT to Rs 827.4 crore.
Sandeep Sangwan, Managing Director, Castrol India Limited:
"The first quarter of 2020 has been unprecedented with an overall slowdown in the economy, liquidity crunch as well as the break-out of the global Covid-19 pandemic. As a result of which, the overall lubricant industry in the country has been hit by severe demand and supply disruptions. Castrol India was resilient and stepped up in managing this extraordinary situation with three clear objectives - protecting people, supporting communities and protecting the financial health of our business.
We have taken various measures to support employees, support staff, distributors and suppliers during these difficult times as #IndiaFightsCorona. We have also stepped up and made contributions to impacted communities in several ways. Our CSR efforts have been focused on helping government hospitals, essential service workers, mechanics, truckers, migrant workers and labourers affected by the crisis.
We continue to work on numerous cost control actions, working capital management as well as efficiency programmes to drive margins and protect our finances.
As part of our strategic delivery, we sustained our efforts to drive consumer communication and customer acquisition across key geographies and markets. We renewed our long-term partnership with JCB, the largest off-road vehicle manufacturer in India. Readying ourselves for a low carbon future, we entered into agreements for EV fluids with OEMs in India including MG Motors and Tata Motors, as well as to supply lubricants to various OEMs for their BS-VI compliant vehicles.
We continue to monitor the dynamic nature of the ongoing crisis and evolve to protect the health and long-term sustainability of our business. Our current strong liquidity position gives us confidence to be able to meet the near-term challenges. We are committed to our overall strategy and growth agenda which will help us realise our potential when normalcy is restored."
The scrip is currently trading around Rs 119 on the BSE
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