Performance for the quarter ended December 2012

The net sales increased by 14% to Rs 392.67 crore. Performance of plastics business grew by 16% to Rs 350.82 crore while lifestyle furniture, furnishings and accessories business grew by just 5% to Rs 45.49 crore.

Plastic business volume grew by 5%. The mattress business sales grew by 54% to Rs 6.46 crore. The mass housing business had a net sales of Rs 9.31 crore. The mass housing project at Ahmedabad is moving ahead at apace as foreseen by the company.

The company has earned a total turnover of Rs 42.34 crore from all its subsidiaries and joint venture companies taken together.

OPM declined by 295 bps to 7.3% due to rise in raw material cost by 350 bps to 38.8% and other expenditure by 220 bps to 23.2% of adjusted net sales. As a result, the operating profit de-grew by 19% to Rs 28.55 crore.

Other income increased by 418% to Rs 0.88 crore. The interest cost increased by 35% to Rs 11.21 crore while depreciation increased by 1% to Rs 10.75 crore. The PBT was down by 55% to Rs 7.47 crore.

Tax outgo was down by 33% to Rs 2.02 crore. The effective tax rate was up from 18.3% to 27.1%. As a result, the net profit has decreased by 60% to Rs 5.45 crore due to fall in margin and rise in interest cost & tax rate.

The PBIT margin of plastics business segment was down by 330 bps to 6.42%. As a result, the plastics business had a PBIT of Rs 22.52 crore, down 23%. The loss at PBIT level in lifestyle furniture, furnishings and accessories business declined by 47% to Rs 1.19 crore.

During FY13, the declining economic condition has badly impacted the manufacturing sector and the consumer sentiments which has put pressure on margin and volume. Secondly, the company is incurring substantial capex since last financial year towards its ongoing expansion program, which has increased the interest and depreciation cost of the company. All this has impacted the bottom-line of the company. The company is however, optimistic of reaping the benefit of this expansion program over a period of time, on the revival of the economic conditions.

Performance for the nine months ended December 2012

The net sales increased by 15% to Rs 1168.99 crore. Performance of plastics business grew by 16% to Rs 1032.49 crore while lifestyle furniture, furnishings and accessories business grew by 8% to Rs 147.03 crore.

OPM declined by 227 bps to 8.6% due to rise in raw material cost by 180 bps to 39.1% and other expenditure by 20 bps to 21.8% of adjusted net sales. As a result, the operating profit de-grew by 9% to Rs 100.3 crore.

Other income increased by 52% to Rs 1.92 crore. The interest cost increased by 11% to Rs 32 crore while depreciation increased by 13% to Rs 33.61 crore. The PBT was down by 31% to Rs 36.6 crore.

Tax outgo was down by 14% to Rs 10.21 crore. The effective tax rate was up from 22.4% to 27.9%. As a result, the net profit has decreased by 36% to Rs 26.4 crore due to fall in margin

The PBIT margin of plastics business segment was down by 200 bps to 7.94%. As a result, the plastics business had a PBIT of Rs 81.93 crore, down 7%. The loss at PBIT level in lifestyle furniture, furnishings and accessories business inclined by 121% to Rs 4.07 crore.

Valuation

The Promoters stake stood at 62.19% for December 2012.

The scrip is currently trading at Rs 212.05 on the BSE.