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Supreme Industries reported a consolidated net sales growth of 8% for Mar'15 quarter to Rs 1082.08 crore. OPM was up by 50 bps to 13.3% resulting in a 12% increase in OP to Rs 144.33 crore. Sale from construction business stood at Rs 53.78 crore for Mar'15 quarter as compared to nil for Mar'14 quarter. Thus, OP including construction profit stood at Rs 198.11 crore, up by 54% YoY.
Other income was down by 93% to Rs 0.03 crore. Interest costs was down by 16% to Rs 16.24 crore and depreciation was up by 38% to Rs 35.26 crore thus resulted in PBT being up by 75% to Rs 146.64 crore. Total tax being up by 77% to Rs 50.55 crore, PAT before Share of Profits from Associates was down by 73% to Rs 96.09 crore. After profit of Rs 6.14 crore of profit from share of associates, consolidated PAT for Mar'15 quarter stood at Rs 102.23 crore, up by 75% YoY.
Consolidated Performance for the nine months ended March 2015
Net sales are up by 8% to Rs 2861.27 crore. Due to a 160 bps fall in OPM to 11.3%, OP stood at Rs 324.55 crore, down by 5%. Profit from construction business stood at Rs 83.75 crore up by 248% YoY. Thus, OP including construction business stood at Rs 408.30 crore, up by 11% YoY. Other income was down by 31% to Rs 1.50 crore. With a 20% fall in interest costs to Rs 47.01 crore and a 40% increase in depreciation to Rs 103.42 crore, PBT stood at Rs 259.37 crore, up by 10% YoY. After providing total tax of Rs 88.50 crore, up by 12%, PAT stood at Rs 170.87 crore, up by 9% YoY. After providing a loss of Rs 8.31 crore from share of profits from associates, PAT stood at Rs 162.56 crore, down by 1% YoY.
The promoters holding in the company is at 49.71% and none of them are pledged.
Other developments
Capex Plans
The company's capex plan of about Rs 270 crore is progressing well. Its new plastic product complex at Kharagpur in West Bengal is likely to commence production during July-Sep 2015 and Roto moulding unit at Malanpur M.P is likely to be operational by Sep 2015.
Raw Material Scenario
There was a continuous and steep fall in polymer prices by about 24% to 30% from their peak level during August 2014 to December 2014. Polymer prices have started moving upwards since January 2015 and are still lower by 10% to 15% from earlier peak. Polymer prices are likely to reach a reasonable level by April 2015 and expected to remain stable and affordable thereafter.
Composite LPG Cylinder Project
Company is receiving many enquiries and positive feedback; still no major breakthrough could be achieved yet. Company is optimistic about the product and it's potential. Government refineries have floated execution order for 3 sizes of cylinders. Company shall participate for 2 of the sizes and expects positive outcome. It may take some more time for a significant break-through then envisaged both in domestic as well as export market.
Supreme Chambers
The company realized about Rs 69.67 crore form sale of 39780 sq. feet of premises during the Mar'15 quarter. Company has further negotiated sale of about 12540 sq. feet premises at consideration of around Rs 25 crore and same is getting completed in April 2015. Major part of the premises have now been sold. The remaining area for sale is about 63868 sq feet out of total saleable area of about 282835 sq feet.
Outlook
Unseasonal rains and hailstorm in many parts of the country during Feb-March and till 3rd week of April affected business scenario both in terms of product demand and pressure on margins. Company expects volume growth between 10-15% and value growth of around 8-10% during the current year over previous year.
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