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In the quarter ended Sep 09, Banco Products, an auto component manufacturer, reported significant growth of 99% in its net profit to Rs 21.10 crore thanks to robust operating performance – 1150 bps growth in OPM as well as non operating performance such as decline in interest cost and raise in other income. Its net operating income grew by 22% to Rs 98.22 crore. It translated to 133% growth in PBT to Rs 26.63 crore. However substantial increase in its tax provision by 532% restricted the growth in its net profit to 99%.
However, the company's financial results for the quarter ended and half year ended Sep 09 includes financials of merged entity Ganga Investments Pvt Ltd w.e.f from 18th Sep 09. Thus the financial results of the company for quarter ended Sep 09 and half year ended Sep 09 are not comparable with their respective corresponding previous periods. The effect of the Scheme of merger of Ganga Investment Pvt Ltd with the Company has also been given in the audited financial statements of the Company for the year ended 2009. Thus the financial results of FY 09 are not comparable with FY 08 too.
Quarter Performance
The company's net operating income grew by healthy 22% to Rs 98.22 crore in quarter ended Sep 09. However, the spurt in its operating profit margin (OPM) by whopping 1150 bps to 29.2% lifted the operating profit by impressive 101% to Rs 28.68 crore.
In terms of cost, as % to sales net stock adjusted, its raw material cost slipped by 890 bps to 48%. Its other expenditure slipped by 30 bps to 20%. Its staff cost slipped by 110 bps to 4%.
Its other income surged by whopping 301% to Rs 0.60 crore. Its interest cost crashed by 58% to Rs 0.29 crore. Its depreciation cost rose marginally by 4% to Rs 2.36 crore. These lifted PBT by impressive 133% to Rs 26.63 crore. However significant increase of 1300 bps in its effective tax rate to 21% and high profit base lifted the tax provision by whopping 532% to Rs 5.54 crore. Thus it restricted the growth in its net profit to 99% to Rs 21.10 crore.
Half Year Performance
In the half year ended Sep 09, the company's net operating income grew by 11% to Rs 185.39 crore. Increase in its OPM by 780 bps to 27.3% lifted the operating profit by impressive 55% to Rs 50.65 crore. The profit levels were further boosted by 196% growth in other income to Rs 1.02 crore; decline in interest cost by 51% to Rs 0.56 crore and 12% growth in depreciation cost to Rs 4.70 crore. Thus its PBT grew by robust 67% to Rs 46.41 crore. However, high tax provision played spoil sport limiting the growth in its net profit to 53% to Rs 37.34 crore.
The promoters' share in the total shareholding has increased to 66.79% in Sep 09 quarter from 66.53% in Jun 09 quarter. The promoters' have pledged ‘nil' shares of the company.
Currently the scrip is trading around Rs 61.65 on BSE.
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