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Elgi Equipment (EEL), the homegrown compressors major registered 80% jump in its consolidated net-profit for the quarter ended Dec 2009 to Rs 18.89 crore on a sale of Rs 182.11 crore, a rise of 32%. Strong bottom-line growth is largely on account of 340 basis points expansion in operating margin to 16.5% which resulted in 66% jump in operating profit to Rs 29.97 crore as well as lower tax incidence.
On standalone basis the sales was higher by 28% to Rs 154.63 crore. And with operating margin expand by 310 bps to 17.1% the operating profit grew by 55% to Rs 26.38 crore. Eventually the net-profit was higher by 66% to Rs 16.49 crore.
Consolidated quarterly performance
Sales for the quarter ended Dec '09 was higher by 32% to Rs 182.11 crore with both compressor as well as automotive business posting double digit growth for the quarter. While the compressor business grew by 33% with increased sales of industrial compressors for the quarter the automotive business grew by 19% on back of good show by automobile sector.
Margin during the quarter has expanded handsomely by 340 bps to 16.5% with all cost component decline for the quarter. Material cost, as a proportion to sales was lower by 70 bps to 61.7%. Staff cost was lower by 60 basis points to 8.7% and that of other cost was lower by 180 bps to 13.6%.
Other income was lower by 85% to Rs 0.09 crore. And interest income was higher at Rs 1.21 crore compared to mere Rs 19 lakh in the corresponding previous period. Depreciation was higher by 17% to Rs 2.44 crore. Consequently the PBT stood at Rs 28.83 crore, a rise of 72%.
Taxation, including deferred tax in absolute terms was higher by 60% to Rs 9.94 crore but the tax rate was lower at 34.5% compared to 37.1% in the corresponding previous period. Thus spurred the net profit was higher by 80% to Rs 18.89 crore.
Consolidated nine-month results
Sales for the nine-month ended Dec ‘09, was higher by 14% to Rs 474.56 crore. As OPM expand to 16.2% from 12.7%, the operating profit growth was higher by 46% to Rs 76.72 crore. With other income lower by 54% to Rs 1.93 crore, the interest cost being higher by 289% to Rs 2.80 crore, the PBDT was higher by 41% to Rs 81.45 crore. The depreciation was higher by 20% to Rs 7.12 crore. Thus the PBT was up by 44% to Rs 74.33 crore. After accounting for taxation of Rs 27.02 crore (up 43%) the net profit was higher by 44% to Rs 47.31 crore.
The share price currently trades at Rs 84.85.
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