The company witnessed steady margins during the quarter. Higher tax provision was mainly responsible for drop in net profits. Else, at the PBT level, the company registered 3% rise in profits during the quarter.

Quarterly Performance

The company witnessed increase in the raw material cost(inclusive of purchase of stock in trade) duringfourth quarter ended Mar 18. The raw material cost as % of sales net of stock adjustments rose 100 bps to 61.2%. The employee cost fell 10bps to 10.76% in Q4 FY 17-18. Other expenses fell 70bps to 20.7%. Resultantly, operating margins was steady at 7.6%. Operating profit rose 4% to Rs 93.49 crore on a y-o-y basis.

With 17% drop in other income to Rs 9.78crore, PBIDT rose 1% to Rs 103.27 crore. Interest cost fell 10%to Rs 14.45 crore. Depreciation cost decreased 4% at Rs 38.12crore. Thus, PBT registered 3% riseto Rs 47.44 crore. After Rs 2.84 crorein tax provision vis a vis Rs 8.02 crore tax credit in previous year, PAT fell 25% at Rs 39.32 crore.

During the quarter, the company earned 17% and 49% of its revenues from cycle and engineering businessrespectively. 29% revenues came from metal formed products. Revenues from cycle and accfell 39%. Engineering and metal formed products registered 14% and 10% rise in revenues respectively. The gear and gear product segment which constitutes 4% of overall revenues, registered 1% drop in income.

At the segment front, cycle and accessories business witnessed Rs 19.55 crore loss vis a vis gain of Rs 6.45 crore in previous year. Engineering division registered 83% rise in profits to Rs 45.62 crore. Metal formed products registered 55% rise in profits to Rs 28.25 crore. Profit from gear and gear products registered 19% rise in profits to Rs 7.25 crore.

Full YearPerformance

For the year ended March 2018, the company's topline grew 12% to Rs 5027.47 crore. The company witnessed decrease in the raw material cost (inclusive of purchase of stock in trade) for FY 18. The raw material cost as % of sales net of stock adjustments fell 5bps to 59.62%. The employee cost rose 6 bps to 11.19% in FY 17-18. Other expenses rose 60bps to 21%. Resultantly, operating margins slipped 90 bps 8.1%. Operating profit registered marginal rise to Rs 407.58 crore.

With 28% drop in other income to Rs 34.62crore, PBIDT fell 2% to Rs 442.2 crore. Interest cost fell 21% to Rs 58.49 crore. Depreciation cost increased 3% at Rs 153.54 crore. Thus, PBT registered 1% rise to Rs 230.17 crore. After considering 530 bps increase in the effective tax rate at around 25.7% and 7% dropin tax provision, PAT fell 11% at Rs 155.51crore.

During FY 17-18, the company earned 25% and 45% of its revenues from cycle and engineering business respectively. 26% revenues came from metal formed products. Revenues from cycle and acc fell 3%. Engineering and metal formed products registered 14% and 5% rise in revenues respectively. The gear and gear product segment which constitutes 4% of overall revenues, registered 8% rise in income.

At the segment front, cycle and accessories business witnessed98% drop in profits to Rs 56 lakh. Engineering division registered 20% rise in profits to Rs 174.92 crore. Metal formed products registered 6% rise in profits to Rs91.31 crore. Profit from gear and gear products registered 16% rise in profits to Rs 33.17 crore.

The stocks is trading around Rs 228 at BSE currently.