KEI Industries registered 16% fall in revenue to Rs 1036.94 crore for the quarter ended Sep 2020. However the OPM was up by 150 bps to 11.4%, the fall at operating profit was restricted at 3% to Rs 118.36 crore. The other income was down by 16% to Rs 3.62 crore and thus the OBIDT was down by 4% to Rs 121.98 crore. The interest cost was down by 58% to Rs 14.95 crore and spurred thus the PBDT was up by 18% to Rs 107.02 crore. The depreciation was up by 4% to Rs 14.19 crore and thus the PBT was up by 20% to Rs 92.83 crore. The taxation was up at Rs 92.62 crore compared to mere Rs 1.11 crore in the corresponding previous period. Thus on high base the PAT was down by 10% to Rs 68.22 crore.
- Downside in revenue was largely due to fall in revenue of all 3 segment of the company. Segment sales of cables was down by 12% to Rs 870.68 crore dragged largely by sharp fall in institutional sales with retail cables sales for the period down by just 2% to Rs 348 crore. While the sales of SS wire was down by 1% to Rs 33.52 crore that of EPC was down by 23% to Rs 247.71 crore.
- EBIT was down by just 1% to Rs 135.22 crore with downside coming from EPC projects. Segment profit of cables was up by 7% to Rs 111.72 crore despite early double digit fall in revenue was largely due to 240 bps expansion in segment margin to 12.8%. Similarly despite early single digit fall in revenue, the segment profit of SS wire was up by strong 80% to Rs 2.24 crore, powered by 300 bps expansion in segment margin to 6.7%. However hit by lower sales and 130 bps contraction in segment margin, the segment profit of EPC Projects was down by 33% to Rs 21.26 crore.
- The company as it opted for reduced rate of income tax u/s 115BAA of IT Act 1961, has re-measured its deferred tax liability as at September 30, 2019 and an amount of Rs 14.281 crore is written back (out of which Rs 12.854 crore pertain to earlier year and Rs 0.7 crore pertains to Quarter ended June 30, 2019) in corresponding previous quarter. This has deflated the taxation (net of deffered tax) for the corresponding previous quarter and inflated the PAT. Thus on inflated base the PAT was down by 10% to Rs 68.22 crore.
Half Yearly performance
Sales was down by 23% to Rs 1782.24 crore and the operating profit was down by 19% to Rs 190.62 crore as the OPM expand by 50 bps to 10.7%. After accounting for higher other income, lower interest and flat depreciation, the fall at PBT was restricted at 4% to Rs 142.34 crore. Taxation was up by 44% to Rs 37.89 crore and thus the PAT was down by 14% to Rs 104.45 crore.
Order book
Order backlog as end of Oct 10, 2020 was approx. Rs 2663 crore down from Rs 2951 crore (EPC Rs 1094 crore; EPC EHV 627 crore; cables Rs 1112 crore; Exports 118 crore) as end of July 31, 2020 and Rs 3244 crore (EPC Rs 1233 crore; EPC EHV 731 crore; cables Rs 1116 crore; Exports 164 crore) as end of Mar 31, 2020.
Other developments
During the quarter and half year ended on September 30, 2020 the Share Allotment Committee has allotted 351000 Equity Shares upon exercise of equivalent number of stocks options, under KEI Employee Stock Option Scheme, 2015 to the eligible employees.
Net debt as on Sep 30, 2020 was Rs 148 crore as against Rs 152 crore as on March 31, 2020.
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