Other Income decreased 4% to Rs 15.2 crore in Q2CY20 from Rs 15.9 crore in Q2CY19 while interest cost was Rs 1.4 crore and depreciation rose 24% to Rs 20.6 crore. As a result PBT was down 69% to Rs 88.47 crore. Effective rate of tax fell 940 bps to 26.1% leading a 64% decrease in PAT to Rs 65.37 crore.

For H1CY'20 Net Sales of the company was down 42% to Rs 1178.6 crore compared to corresponding previous year while bottomline decreased 48% to Rs 190.6 crore. OPM fell 530 bps to 22.8% leading a 53% fall in operating profits to Rs 268.3 crore. Other income decreased 5% to Rs 35 crore while interest cost was Rs 2.5 crore and depreciation was up 30% to Rs 42.8 crore. PBT as a result fell 55% to Rs 258 crore. Effective rate of taxes fell 950 bps to 26.1% leading a 48% decrease in PAT to Rs 190.6 crore.

"Castrol India's performance in the second quarter and first half of 2020 speaks of our resilience and determination, while being focused towards three priorities – protecting our people, supporting communities and protecting the financial health of our business in these difficult times.

This is despite disruptions owing to the Covid-19 pandemic which escalated in the second quarter of 2020, resulting in a continued slowdown of the economy including decline in lubricants consumption.

I would like to acknowledge the efforts and commitment of our teams in our three manufacturing plants who have, while adhering to the strict government safety guidelines during the lockdown, kept our operations going to fulfill customer demand, and also those working from their homes under these trying circumstances.

We have committed Rs. 11.7 crore of our annual CSR budget during this quarter to support several impacted communities as #IndiaFightsCorona. Separately, we have also offered support to customers to resume operations safely through complimentary sanitization drives and kits provided to over 12,000 distributors, dealers, independent and franchise outlets, while also providing complimentary lubricants to essential service workers putting up an extraordinary fight against this disease.

Robust working capital management which saw us generate Rs 302 crore net cash from operations in 1H 2020 which is 85% of last year's levels, along with judicious cost management and efficiency programmes have helped us maintain a current strong liquidity and financial position to be able to meet any near-term challenges.

Another key development was the signing of the strategic alliance with the Jio-bp fuel retail network which will enable Castrol lubricants enhanced reach and visibility at 1,400 Jio-bp retail sites across the country, which are planned to expand to 5,500 sites in the next five years.

We have been equally focused on our strategic deliveries during this period. With digitization unfolding as the new normal, we leveraged digital to build a strong virtual connect and advocacy amongst several key stakeholders.

During the quarter, we initiated an online Castrol Super Mechanic Academy and live classroom which upskilled over 35,000 mechanics and independent workshop owners to help them make a stronger comeback to business. Castrol also reached out to 28,000 customers with its Industrial Restart Offer designed to support customers as and when they resume production post lockdown. Similarly, we connected with over 50 key dealerships through virtual trainings in our franchise workshop channel and had our first virtual webinar for industrial customers on rust preventives which saw over 700 participants.

Our agility and responsiveness to this volatile situation is a reflection of the strong fundamentals of the business. Our strategy remains unchanged and we are confident of long-term profitable business growth as economic activities return to normalcy."

The scrip is currently trading around Rs 116 on the BSE