It seeks to provide a competitive edge to its customers through a wide variety of standard high quality products as well as items customized to their requirements such as special purpose machines, metalworking tools, customized tooling solutions and engineered products.

December 2016 quarter results

For the quarter ended December 2016, sales grew 11% to Rs 159.96 crore. OPM improved 90 basis points from 8.0% to 8.9% which saw OP grow 23% to Rs 14.21 crore.

Other income grew 36% to Rs 2.21 crore. Interest cost was nil as the company is a debt free company.

As depreciation grew 14% to Rs 6.86 crore, PBT grew 34% to Rs 9.56 crore.

As provision for taxation fell 14% to Rs 1.83 crore, PAT rose 54% to Rs 7.73 crore.

Six months results

For the six months December 2016, sales grew 15% to Rs 311.28 crore. OPM improved 80 basis points from 7.2% to 8.1% which saw OP grow 27% to Rs 25.06 crore.

Other income grew 2% to Rs 3.96 crore. Interest cost was nil as the company is a debt free company.

As depreciation grew 12% to Rs 13.40 crore, PBT grew 35% to Rs 15.62 crore.

As provision for taxation grew 4% to Rs 3.20 crore, PAT rose 46% to Rs 12.42 crore.

Quarter Segment results

For the quarter, sales from the Machine Tools division fell 22% to Rs 20.46 crore and accounted for 13% of sales. PBIT from the same stood at a loss of Rs 31 lakh against a profit of Rs 2.84 crore and accounted for -2% of total.

For the quarter, sales from the Hard Metals and Hard Metals Products grew 20% to Rs 139.50 crore and accounted for 87% of sales. PBIT from the same grew 73% to Rs 16.69 crore and accounted for 102% of total.

For the six months, sales from the Machine Tools division fell 16% to Rs 37.81 crore and accounted for 12% of sales. PBIT from the same fell 95% to Rs 8 lakh and accounted for 0% of total.

For the six months, sales from the Hard Metals and Hard Metals Products grew 21% to Rs 273.47 crore and accounted for 88% of sales. PBIT from the same grew 38% to Rs 27.80 crore and accounted for 100% of total.

Market condition

The company serves markets like Automobile (2W, PV, LCV and MHCV), tractors which have been performing well. Aerospace, Defence and railways are also doing well.

However other segments like steel, capital investments in manufacturing (including greenfield activities), Oil & Gas Energy and Mining which were laggards.

Strategy

Going forward the company hopes to consolidate and grow its core business and enhance its market reach by expanding distribution channel.

It also plans to diversify and has increased focus in aerospace, defence, railways segments.

It is also exploring exports of its Machining Solutions Group (MSG) products.

The company has taken special initiatives to grow the WIDIA business.

It will continue to modernize and upgrade its manufacturing facilities.

Valuation

The share price trades at Rs 602.