Key highlights

• The net sales for Q4 has increased by 4% to Rs 177.98 crore. OPM has increased by 420 basis points to 8.8% due to fall in ASP cost. The company has reported a net profit of Rs 10.98 crore, a rise of 25% on the back of rise in margin due to cut in ASP spend.

• The net sales for FY11 has increased by 10% to Rs 720.71 crore. OPM has declined by 130 basis points to 4.1% due to rise in raw material cost and cost of purchase of traded goods. The company has reported a net profit of Rs 31.78 crore, a rise of 26% on back of EO income

• FY11 growth was partly driven by increase in food business which saw volume growth and balance by price hike in oil business.

• Food business has crossed Rs 100 crore mark and now contributes 15% of total sales.

• Employee cost was up because of subsidiary which hired 600 people, which are employed for covering the retail outlets to increase its distribution reach. As such, the ASP spend has fallen down on Q-o-Q basis for Q4 due to fleet on street for retail coverage instead of spending on media

• ACT II distribution doubled to 330000 outlets.

• The company has launched 2 new products: a) convenience meal in 6 variants, presently rolled out in Delhi. This is new category which is between noodles and ready to eat foods. The products are very famous in US, where it is sold by parent company ConAgro. It is lunched at price point of Rs 30 to Rs 45. The company is very cautious on launching of new product, as it does not want to incur loss on product. b) Cooking Spray, which is also presently rolled out in Delhi. Both the products are launched under Sundrop brand.

• It will continue to launch new products.

• Cash in bank came down from Rs 89 crore to Rs 45 crore because of inventory due to corn purchase, money which didn't came from CSD and capex.

• The management expect gross margin to increase from 20% to 30% and food business contribution from 15% to 25% then to 50% of total sales in coming years.