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Sundram Fasteners (SFL) is a part of the TVS Group, headquartered in Chennai, India. The product range consists of high-tensile fasteners, powder metal components, cold extruded parts, hot forged components, radiator caps, automotive pumps, gear shifters, gears and couplings, hubs and shafts, tappets and iron powder. Over the years, the company has acquired cutting-edge technological competencies in forging, metal forming, close-tolerance machining, heat treatment, surface finishing and assembly.
June 2015 quarter results
For the quarter ended June 2015, it registered a 9% growth in sales to Rs 631.94 crore.
Exports sales accounted for Rs 225.80 crore (down 1% and domestic sales accounted for Rs 378.74 crore (up 25%).
OPM fell 190 basis points to 14.0% which saw OP falling 4% to Rs 88.32 crore.
Other income jumped 433% to Rs 5.92 crore and interest cost fell 17% to Rs 10.69 crore.
Other income includes exchange gain of Rs 5.11 crore against Rs 13.19 lakh.
Interest cost includes forex loss of Rs of Rs 5.71 crore against Rs 7.27 crore.
As depreciation fell 18% to Rs 22.59 crore, PBT rose 16% to Rs 60.96 crore.
EO loss stood at Rs 2.50 crore against nil. Thus PBT after EO rose 11% to Rs 58.46 crore.
EO represents diminution in value of investments in subsidiary company names Peiner Umformtechnik GmBH, Germany recognized in the current quarter against the provision made in FY 2015 amounting to Rs 10 crore.
Tax rose 12% to Rs 16.17 crore after which PAT ended up 11% to Rs 42.29 crore.
FY 2015 results
In FY 2015, sales grew 18% to Rs 2386.39 crore.
Exports grew 19% to Rs 955.66 crore and domestic business grew 17% 1430.73 crore.
OPM improved 130 basis points to 14.0% which saw OP rising 30% to Rs 333.43 crore.
Other income crashed 52% to Rs 23.36 crore and interest cost rose 39% to Rs 81.39 crore.
Interest cost includes forex loss of Rs of Rs 60.01 crore against Rs 27.83 crore.
As depreciation rose 16% to Rs 88.32 crore, PBT grew 10% to Rs 187.08 crore.
EO loss stood at Rs 10 crore against Rs 10 crore. Thus PBT after EO rose 11% to Rs 177.08 crore.
Tax grew 7% to Rs 41.76 crore after which PAT ended up 12% to Rs 135.32 crore.
Outlook
The pace of growth in domestic market will improve going forward, as the government addresses various problems faced by the economy.
Prospects for increasing exports appear to be encouraging
Valuation
The share price trades at Rs 183.
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