As a result of the nationwide lockdown imposed by the Government of India, the operations of the company were temporarily disrupted at its various manufacturing plant impacting production and dispatches from the second half of March 2020. The company has resumed plant operations since last week of April 2020 / first week of May 2020 in compliance with the guidelines issued by respective authorities. The company has taken adequate precautions for safety and wellbeing of the employees while resumption of operation of its plant.

OPM fell180 basis points to 11.1% which saw OP fell30% to Rs 117.1 crore.Other income was Rs 28 lakh compared to Rs 3 lakh. Interest cost increased 139% to Rs 7.79 crore. As depreciation grew 2% to Rs 50.77 crore, PBT fell 49% to Rs 58.82 crore. Tax provision fell 63% to Rs 14.64 crore compared to tax provision of to Rs 39.95 crore. PAT fell41% to Rs 44.18 crore.

Profit in JV was loss of Rs 3.65 crore compared to profit of Rs 12.48 crore in Q1FY20. Finally net profit fell53% to Rs 40.53 crore.

The overall turnover of value added products remained at Rs. 378 crore during the current quarter as compared to Rs. 457 crore in the corresponding period of previous year.

Total Net Borrowing of the Company stands at surplus of Rs. 31 crore as on 30th June, 2020 as against Borrowings of Rs. 217 crore as on 31st March, 2020.

Average Net Borrowing level during the current quarter remained at Rs. 134 crore against Rs. 169 crore in corresponding quarter in the previous year. Average Cost of Borrowings as on 30th June,2020 decreased to 7.53 % p.a. as against 8.35 % p.a. as on 31st March, 2020.

FY 2020 consolidated results

In FY 2020, sales fell2% to Rs 5511.54 crore.The company sold 411521 tonne of plastic goods during FY20 against sales of 397983 tonne in the previous year achieving volume growth about 3% and product value degrowth of about 1%, respectively. The overall turnover of value added products increase to Rs. 2070 crore as compared to Rs. 1944 crore in the previous year achieving growth of 6%.

OPM rose 210 basis points to 15.1% which saw OP rose 14% to Rs 829.55 crore. Profit from the construction business was Rs 5 crore compared to Rs 54 crore in FY19. OP including construction business was up 6% to Rs 834.55 crore.

Other income fell 82% to Rs 1.43 crore and interest cost fell 22% to Rs 20.19 crore. As depreciation grew 12% to Rs 205.68 crore, PBT before EO rose5% to Rs 610.11 crore.

EO gains were nil compared to Rs 67.19 crore. Thus PBT after EO fell 6% to Rs 610.11 crore.

As tax fell 19% to Rs 173.92 crore, PAT remained flat at Rs 436.19 crore.

Profit in JV rose 117% to Rs 31.21 crore. Finally net profit rose4% to Rs 467.4 crore.

Since second half of March, 2020, Country is fighting against the global pandemic Covid 19. Country has witnessed series of lock downs initially throughout the country and unlocking process has begun since June.

Since July, partial lock downs in various parts of the country has hampered smoothening of the economic revival, which was further aggravated by exodus of millions of workers to their native places from various cities in May/June. This has severely affected construction activities and plant operations throughout large cities and Tier II cities.

Although production and dispatches at all the plants of the Company have commenced during last week of April/first week of May, 2020, normalcy of operations and business level is yet to be restored at pre Covid level. Plants for Piping products, Packaging Film and Cross Laminated Film products and material handling products have seen gradual recovery and by now have reached near to normalcy of operations whereas plants for Furniture and Industrial Components and certain segments of Packaging products are operating between 50 to 70% capacity utilization.

Continuance of the present status makes it difficult to forecast the annual outlook about the businesses for the year. The promising part in this situation is robust demand from rural and Tier III & Tier IV cities. Company enjoyed better demand in rural market compared to corresponding period of previous year for the products, which are catered by it to these markets.

The harvested Rabi crop was bountiful. The monsoon this year is quite widespread which augurs well for bumper Kharif crop. Crude oil prices remain range bound at below 45$ a barrel. The banks are flush with funds with bias of lowering the rate of interest further.

Central and State Governments are taking various steps to boost the economy by pushing infrastructure investments. Polymer prices have shown upward trend since second half of May but remain affordable.

Company expects that once these widespread localized lockdowns are significantly reduced, the pent up demand will emerge for all the products in the company's portfolio.

Envisaging good demand prospect in the year 2021-22, the company has committed and/or to commit an investment of around Rs. 350 crores in its' various existing plants and in putting up new plant to make piping system at Orissa and a Cross Plastic Film plant at a site adjacent to its' Composite Cylinder plant in Gujarat. Company continues to keep tight control on its fixed costs. Company also is able to manage its working capital requirements efficiently by keeping strict control on its debtors in number of sale days.

The stock trades at Rs 1134.