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Results
14-Feb-22
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Analysis
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Garware Technical Fibres
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Confident to deliver strong results in Q4
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Garware
Technical Fibres consolidated net sales increased 10.67% to Rs 308.13 crore in
Q3FY22 compared to Q3FY21. Sales of
Synthetic Cordage segment has gone up 16.11% to Rs 277.22 crore (accounting for
88.01% of total sales). Sales of Fiber
and Industrial Products & Projects segment has gone down 12.56% to Rs 37.78
crore (accounting for 11.99% of total sales).
Inter-segment sales rose Rs 3.53 crore to Rs 6.87 crore.
Operating
profit margin has declined from 20.90% to 18.04%, leading to 4.47% decline in
operating profit to Rs 55.59 crore. Raw
material cost as a % of total sales (net of stock adjustments) increased from
26.87% to 29.07%. Purchase of finished
goods cost fell from 2.74% to 1.57%.
Employee cost decreased from 14.04% to 12.88%. Other expenses rose from 36.20% to
38.49%.
Other
income fell 47.94% to Rs 4.81 crore.
PBIDT fell 10.43% to Rs 60.4 crore.
Profit before interest, tax and other unallocable items (PBIT) has
slumped 1.54% to Rs 59.05 crore. PBIT of
Synthetic Cordage segment rose 5.07% to Rs 55.79 crore (accounting for 94.48%
of total PBIT). PBIT of Fiber and Industrial
Products & Projects segment fell 52.62% to Rs 3.26 crore (accounting for
5.52% of total PBIT).
PBIT
margin of Synthetic Cordage segment fell from 22.24% to 20.12%. PBIT margin of Fiber and Industrial Products
& Projects segment fell from 15.92% to 8.63%. Overall PBIT margin fell from 21.27% to
18.75%.
Provision
for interest rose 28.80% to Rs 4.07 crore.
PBDT fell 12.35% to Rs 56.33 crore.
Provision for depreciation rose 3.04% to Rs 5.43 crore. Profit before tax down 13.73% to Rs 50.90
crore. Share of profit/loss were nil in
both the periods. Provision for tax was expense
of Rs 12.84 crore, compared to Rs 15.85 crore.
Effective tax rate was 25.23% compared to 26.86%.
Net
profit attributable to owners of the company decreased 11.80% to Rs 38.06
crore.
Promoters’
stake was 52.62% as of 31 December 2021 compared to 53.02% as of 31 December
2020.
For year-to-date (YTD)
results analysis
Net
sales of Garware Technical Fibres has increased 19.16% to Rs 833.09 crore. Sales of Synthetic Cordage segment has gone
up 20.67% to Rs 719.95 crore (accounting for 84.52% of total sales). Sales of Fiber and Industrial Products &
Projects segment has gone up 16.89% to Rs 131.86 crore (accounting for 15.48%
of total sales). Inter-segment sales
rose Rs 10.27 crore to Rs 18.72 crore.
Operating
profit margin has declined from 19.08% to 17.95%, leading to 12.07% rise in
operating profit to Rs 149.53 crore. Raw
material cost as a % of total sales (net of stock adjustments) increased from
23.56% to 30.52%. Purchase of finished
goods cost fell from 2.82% to 2.67%.
Employee cost decreased from 16.48% to 12.93%. Other expenses fell from 38.36% to
36.99%.
Other
income fell 28.53% to Rs 20.72 crore.
PBIDT rose 4.83% to Rs 170.25 crore.
Profit before interest, tax and other unallocable items (PBIT) has
jumped 12.68% to Rs 158.25 crore. PBIT
of Synthetic Cordage segment rose 14.16% to Rs 142.35 crore (accounting for
89.95% of total PBIT). PBIT of Fiber and
Industrial Products & Projects segment rose 0.90% to Rs 15.90 crore
(accounting for 10.05% of total PBIT).
PBIT
margin of Synthetic Cordage segment fell from 20.90% to 19.77%. PBIT margin of Fiber and Industrial Products
& Projects segment fell from 13.97% to 12.06%. Overall PBIT margin fell from 19.80% to
18.58%. Provision for interest rose
15.92% to Rs 9.1 crore. PBDT rose 4.26%
to Rs 161.15 crore. Provision for
depreciation rose 5.23% to Rs 16.1 crore.
Profit
before tax grew 4.16% to Rs 145.05 crore.
Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 34.16
crore, compared to Rs 34.08 crore.
Effective tax rate was 23.55% compared to 24.47%. Net profit
attributable to owners of the company increased 5.43% to Rs 110.89 crore.
Promoters’
stake was 52.62% as of 31 December 2021 compared to 53.02% as of 31 December
2020.
Management Comments:
Mr.
Vayu Garware, CMD,Garware Technical Fibres Ltd. said, "We continued to
move ahead on our growth trajectory in the quarter led by robust demand in
International business and uptick in the International sports sector. Year on
year growth is not comparable due to a spillover effect in Q2 last year from
significant pending international orders that were delivered in Q2 due to the
first extended March 20 lockdown. On an HI basis, we are able to see growth in
PBT of 17.3% compared to HI FY21 and growth in PBT of 21.4%from Q2 FY20.
Q2
F22 has seen many challenges. Significant inflation in raw materials and
commodities have taken place. We have been able to pass on a majority of these
albeit with some months lag. However, another major hurdle has been the global
supply chain disruption, which has led to an unprecedented increase in freight
costs, which has affected our margins in export. In addition, the cycle time to
dispatch goods to customers in many parts of the world has significantly
increased due to non-availability of containers despite having the materials
ready. This has resulted in an increase in inventory and corresponding
reduction in sales and cash flows in Q2. The challenges of high input costs,
global supply chain disruption and delays in international deliveries are
continuing, however we are able to see that the situation is improving now. We
confident that we would be able to deliver strong results in the later part of
FY22.We have also seen a strong order in-flow during this quarter to support
this expectation.
In
these challenging Covid-19 pandemic times, the safety of our work force and
support to our communities continue to be our priorities, along with delivering
the business results. Our team has been working hard on these initiatives and
we are all thankful that we have been able to maintain normal operations
without any significant incidents.
The stock
trades at Rs 2933.
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Garware Technical Fibres : Consolidated Results
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Particulars
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2112
(03)
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2012
(03)
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Var.(%)
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2112
(09)
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2012
(09)
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Var.(%)
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2103
(12)
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2003
(12)
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Var.(%)
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Net Sales
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308.13
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278.43
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11
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833.09
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699.15
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19
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1,034.57
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953.09
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9
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OPM (%)
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18.0
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20.9
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17.9
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19.1
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19.8
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18.6
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OP
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55.59
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58.19
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-4
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149.53
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133.41
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12
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204.37
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177.5
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15
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Other Inc.
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4.81
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9.24
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-48
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20.72
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28.99
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-29
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34.67
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32.19
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8
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PBIDT
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60.40
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67.43
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-10
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170.25
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162.40
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5
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239.04
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209.69
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14
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Interest
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4.07
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3.16
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29
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9.10
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7.85
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16
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10.32
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11.57
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-11
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PBDT
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56.33
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64.27
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-12
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161.15
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154.55
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4
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228.72
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198.12
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15
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Depreciation
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5.43
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5.27
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3
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16.10
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15.30
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5
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20.65
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19.26
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7
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PBT
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50.90
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59.01
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-14
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145.05
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139.26
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4
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208.07
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178.86
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16
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Taxation
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12.84
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15.85
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-19
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34.16
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34.08
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0
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49.67
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38.33
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30
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PAT
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38.06
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43.15
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-12
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110.89
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105.18
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5
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158.4
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140.53
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13
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Minority Interest (MI)
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0.00
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0.00
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0.00
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0.00
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0
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0
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-
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Net profit
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38.06
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43.15
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-12
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110.89
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105.18
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5
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158.4
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140.53
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13
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EPS (Rs)*
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#
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#
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#
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#
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76.8
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68.2
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Notes
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* EPS is on current equity of Rs 20.62 crore, Face value of Rs
10, Excluding extraordinary items.
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# EPS is not annualised
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bps : Basis points
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Figures in Rs crore
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Source: Capitaline Corporate Database
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Garware Technical Fibres : Consolidated Segment Results
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% of (Total)
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2112
(03)
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2012
(03)
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Var.(%)
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% of (Total)
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2112
(09)
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2012
(09)
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Var.(%)
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% of (Total)
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2103
(12)
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2003
(12)
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Var.(%)
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Sales
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Synthetic Cordage
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88
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277.22
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238.75
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16
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85
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719.95
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596.61
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21
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83
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878.46
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796.28
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10
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Fiber and Industrial Products & Projects
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12
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37.78
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43.2
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-13
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15
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131.86
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112.81
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17
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17
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174.15
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174.95
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0
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Total Reported Sales
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100
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315
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281.95
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12
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100
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851.8
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709.42
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20
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100
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1,052.61
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971.23
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8
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Less: Inter segment revenues
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6.87
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3.53
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95
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18.72
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10.27
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82
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18.04
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18.14
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-1
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Net Sales
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308.13
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278.43
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11
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833.09
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699.15
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19
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1,034.57
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953.09
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9
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PBIT
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Synthetic Cordage
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94
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55.79
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53.1
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5
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90
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142.35
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124.69
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14
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88
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188.95
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162.9
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16
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Fiber and Industrial Products & Projects
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6
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3.26
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6.88
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-53
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10
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15.9
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15.76
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1
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12
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25.85
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23.9
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8
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Total PBIT
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100
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59.05
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59.97
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-2
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100
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158.25
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140.45
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13
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100
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214.8
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186.8
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15
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Less : Interest
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4.07
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3.16
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29
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9.1
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7.85
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16
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10.32
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11.57
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-11
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Add: Other un-allcoable
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-4.08
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2.19
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PL
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-4.1
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6.65
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PL
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3.59
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3.63
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-1
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PBT
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50.9
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59
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-14
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145.05
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139.26
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4
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208.07
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178.86
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16
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