Key Points of the call:

On a standalone basis, TII registered revenues of Rs 1063 crore for quarter ended March 2016 vis a vis Rs 903 crore, rise of 18%. Pat stood at Rs 671 crore vis a vis a gain of Rs 77 crore in previous year after adjusting for stake sale in Cholamandalam General Insurance business. PBT before EO stood at Rs 55 crore vis a vis Rs 47 Crore.

On a standalone basis, TII registered revenues of Rs 3941 crore for year ended March 2016 vis a vis Rs 3828 crore, rise of 3%. Pat stood at Rs 730 crore vis a vis a gain of Rs 121 crore in previous year after adjusting for stake sale in Cholamandalam General Insurance business. PBT before EO stood at Rs 139 crore vis a vis Rs 121 crore, growth of 15%.

The finance cost for the year remained almost the same.

Proceedings from stake sale will be utilized in reducing debt. The debt/equity is expected to come down to 0.35% from 0.7%.

Among the 17-18% growth in turnover in Q4 FY 16, turnover from bicycle business grew 45%. Engineering and metal formed divisions registered 4% increase in turnover each.

For the year FY 16, turnover from bicycle business grew 13%. In engineering business, there was a drop of 5.5% mainly due to lower realizations due to lower steel cost. In metal formed division, it grew 2.6%.

Tube Investments reported strong volume growth in bicycles segment on back of government orders, especially from West Bengal government. For the FY 16, turnover from bicycle business grew by 13%.

The company is setting up a plant at Rajpura. The company has already spent Rs 100 crore on this and plans to inaugurate the plant in June 2016. It will give the company proximity in North Indian market.

The company supplied almost 1.1 million bicycles as government orders this year. Generally it does 0.5 million every year.

Out of 4.5 million cycle sales, of the balance 3.4 million, 30-32% are standard bicycles.

The company has started exporting children cycles to Europe. It did around 60,000 units in FY 16 and plans to increase it to 100,000 units in current FY.

The high end bicycle business is doing very well. Though the market is small, the percentage growth in this is very good.

Pending order book for Shanti Gears stands at Rs 100 crore.

The company's capex plan stands around Rs 175 crore spread across all 3 divisions.

The capacity utilization of bicycle unit is around 90%. With new addition, the new capacity will be of 5.4 million units.

In the engineering business, revenue drop was 6% to Rs 1629 crore in FY 16. Volumes remained flat in tubes and -7% growth in cold rolled steel strips. PBIT stood at Rs 95 crore vis a vis Rs 103 crore, lower due to additional cost associated with larger diameter tubing facility. Revenue from this will increase in current FY.

In the metal formed products division, revenue increased 3% during the year to Rs 954 crore. PBIT rose to Rs 86 crore vis a vis Rs 81 crore. Sale of automotive chains, industrial chains and Fine Blanked Components registered growth of 7%, 6% and 8% respectively. Doorframe segment was lower by 5%.

The metal formed division will have noticeable growth from pickup in auto industry.

Growth in bicycle business will be a moderate 2-3% in FY 17. Without the West Bengal order, TII could grow by 2-3%. In the bicycle business, the company constantly looks at the mix of the products, so there is a lot of enthusiasm for high-end cycling, etc. the proportion of which is growing, which could definitely have a positive impact on the margins.

Surprisingly, the auto industry has done well in April. The management sees the same trend continuing in May also, for more order book. If this trend continues, it will be very good for this year.