Performance for the quarter ended June 2013

The net sales for Q1 FY14 grew by just 1% to Rs 306.33 crore due to high base effect and continuing slowdown in key southern markets . Operating profit margin declined by 210 bps to 13.5% due to rise in raw material cost by 799 bps to 33.7% of adjusted net sales. As a result, the operating profit declined by 13% to Rs 41.37 crore.

Other income stood at Rs 1.73 crore. The interest cost was lower by 2% to Rs 3.07 crore while the depreciation was higher by 18% to Rs 2.4 crore. The Profit before Tax (PBT) decreased 14% to Rs 37.63 crore.

The tax outgo has decreased by 10% to Rs 11.84 crore. The effective tax rate increased to 31.5% during the quarter as compared to 30.1% in the corresponding previous quarter. The net profit has decreased by 16% to Rs 25.79 crore.

Chairman Speech – at 57^th AGM

The chairman said:-

For FY14, as expected the growth in Q1 was minimal owning to base effect as well as continuing slowdown in key southern markets. I expects improved growth rate in coming quarters. New range in existing products categories will be launched from second quarter onwards.

During FY14, the company will be completing its Rs 325 crore capital expenditure program commenced couple of years back. The final phase of the program, the Gujarat Unit has completed most part of the erection and commissioning and trail runs have been taken during the second week of July 2013. The debt exposure as of now stands around Rs 100 crore. The fresh issue of capital to Cartica Capital has already been approved by shareholders and the proceeds of the issue totaling Rs 106.5 crore will be available for use from mid-July 2013 subject to completing of process of allotment of share.

Performance for the year ended March 2013

The sales grew 23% to Rs 1358.48 crore. The cooker segment sales grew by 24% to Rs 511 crore, the cookware segment sales were up by 5% to Rs 236 crore, appliances segment sales grew by 28% to Rs 583 crore, while others grew by 75% to Rs 56 crore. Export was up from Rs 33.96 crore to Rs 65.22 crore

Higher raw material cost led OPM to decline by 50 bps to 15%. The operating profit was higher by 19% to Rs 203.72 crore.

Other income increased by 6% to Rs 4.73 crore. The interest cost was higher by 122% to Rs 14.26 crore and the depreciation by 44% to Rs 8.99 crore. As a result, the Profit before Tax (PBT) increased 13% to Rs 185.2 crore.

The tax outgo has increased by 4% to Rs 52.11 crore. The effective tax rate fell to 28.1% during FY13 as compared to 30.6% in FY12. Thus the net profit has increased by 17% to Rs 133.09 crore.

Shareholding Pattern

The promoter's current hold stood at 74.96%.

Valuation

The scrip is currently trading at around Rs 3831.25 on the BSE.