The topline grew by 24% to Rs 261.54 crore in Dec 2011 quarter. Inability to pass on costs to customers and unexpected air freight charges for certain consignments (a one off) led to whopping 470 bps crash in operating profit margin (OPM). Thus the operating profit fell by 19% to Rs 22.62 crore.

Quarter Performance

The standalone operating income grew by 24% to Rs 261.54 crore in Dec 2011 quarter. However inability to pass on hike in costs and air freight incurred on certain consignments led to whopping 470 bps crash in OPM to 8.6%. Thus the operating profit fell by 19% to Rs 22.62 crore. Other expenditure, as % to sales net stock adjusted, surged by 240 bps to 25% primarily on unexpected air freight on certain consignments, a one off item in current quarter. Also the staff cost increased by 170 bps to 13%. Only the raw material costs fell by 70 bps to 54%.

Hike in non operating expenses, crash in other income and incurring forex loss dragged down the PBT to close to nil at Rs 0.04 crore from Rs 12.06 crore in Dec 2010 quarter. The other income crashed by whopping 98% to Rs 0.03 crore while the depreciation cost grew by 17% to Rs 12.65 crore. The interest cost too spurted by notable 43% to Rs 9.53 crore. It incurred forex loss of Rs 0.42 crore against forex gain of Rs 0.20 crore. However earning net EO income of Rs 18.32 crore (against none in Dec 2010 quarter) boosted the PBT after EO by robust 52% to Rs 18.36 crore. The net EO income represents profit on sale of long term investments amounting to Rs 25.34 crore i.e. its full stake holdings in HDFC, HDFC bank and ICICI and forex loss on AS11 restatement loss of Rs 7.02 crore. Further crash in effective tax rate by 510 bps lifted the net profit by impressive 62% to Rs 15.83 crore.

Nine Month Performance

In nine month ended Dec 2011, the topline grew by healthy 29% to Rs 749.86 crore. Fall in OPM by 50 bps to 10.2% led to limited 23% growth in operating profit to Rs 76.77 crore. Hike in non operating expenses, fall in other income and incurring forex loss (against forex gain in nine month ended Dec 2010) led to 3% fall in PBT before EO to Rs 24.48 crore. However the PBT after EO spurted by impressive 79% to Rs 45.30 crore on earning EO income of Rs 20.82 crore (against nil in nine month ended Dec 2010). The net profit settled with impressive though limited 77% growth to Rs 38.24 crore on account of 90 bps hike in effective tax rate.

• The promoter's % of share holding remained unchanged at 80% as on 31^st Dec 2011. The promoters' have pledged nil shares of the company as on 31^st Dec 2011.
• The board / committee of directors, at their meetings held on 30th November 2011 and 26th December 2011 respectively, approved the modified Composite Scheme of Arrangement including amalgamation and demerger among the Company and its wholly owned subsidiaries, namely Anusha Investments Limited (AIL) and Sundaram Investment Limited (SIL) and their respective shareholders under sections 391-394 read with 100-102 of the Companies Act, 1956 for restructuring the activities by amalgamation of AIL with the Company and demerger of non-automotive related business of the Company in favour of another wholly owned subsidiary, namely SIL, subject to approvals of the stock exchanges, shareholders and the Hon'ble High Court of Madras.

The scrip trading at Rs 175.90 on BSE