Exide Industries overshot the market expectations in the quarter ended Dec 2011 on overall improved performance quarter on quarter basis. On quarter on quarter basis, the company has improved from poor performance in Sep 2011 quarter - the net profit surged by whopping 104% to Rs 104.30 crore on 6% growth in topline to Rs 1246.73 crore in Dec 2011 quarter. The operating profit margin (OPM) surged by 520 bps enabling 70% q-o-q spike in operating profit.
On year on year basis, the net profit fell by 16% to Rs 104.30 crore primarily on account of weak operating performance, incurring forex loss (against forex gain) and unfavorable non operating performance. The topline grew by 19% to Rs 1246.73 crore on improved sales in two wheeler and industrial segment sales. The operating profit margin (OPM) fell by 110 bps on account of high priced lead inventory and sharp rupee depreciation despite softening of lead prices. Thus the operating profit growth was limited to 10% to Rs 172.70 crore.
Quarter Performance
The standalone topline grew by healthy 19% to Rs 1246.73 crore in Dec 2011 quarter driven by healthy sales in two wheeler and industrial segments though automotive demand was flat. The industrial segment witnessed 13% growth in sales volume aided by increased demand for inverter and VRLA batteries. The two wheeler batteries grew nearly by 20%. The OPM crashed by 110 bps to 13.9% primarily due to high priced lead inventory of two months held by the company at the end of Sep 2011 quarter and sharp rupee depreciation despite the softening of lead prices. Thus the operating profit growth was limited to 10% to Rs 172.70 crore. However quarter on quarter, the OPM has improved by whopping 520 bps resulting in 70% q-o-q spike in operating profit.
Raw material costs, as % to sales net stock adjusted, surged by 290 bps y-o-y to 68%. The remaining expenses reduced i.e. traded goods cost by 110 bps to below 1%; other expenditure down by 30 bps to 13% and staff cost by 30 bps to 6% respectively.
PBT fell by 14% to Rs 146.05 crore on incurring forex loss and unfavorable non operating performance. It incurred forex loss of Rs 10.36 crore against forex gain of Rs 2.74 crore in Dec 2010 quarter. The other income crashed by whopping 70% to Rs 9.95 crore while the depreciation cost grew by 18% to Rs 25.04 crore. Only the interest cost reduced by 36% to Rs 1.20 crore. The net profit was pulled down further by 16% to Rs 104.30 crore on 170 bps spike in effective tax rate.
However, on quarter on quarter basis, the company has improved from poor performance in Sep 2011 quarter - the net profit surged by whopping 104% on 6% growth in topline in Dec 2011 quarter.
Nine Month Performance
In nine month ended Dec 2011, the company's operating income grew by 10% to Rs 3663.41 crore. High priced lead inventory resulted in whopping 620 bps crash in OPM to 13.5% thus lowering the operating profit by 25% to Rs 493.65 crore. High depreciation cost, incurring forex loss (against forex gain in nine month ended Dec 2010) and earning nil EO income (against income of Rs 46.93 crore in nine month ended Dec 2010) pulled down the PBT after EO by notable 37% to Rs 446.15 crore. Fall in effective tax rate by 50 bps led to 37% fall in net profit to Rs 318.65 crore.
Highlights
- The company expects the margins to improve in Q4 FY 12 on account of the lower volatility in Indian Rupee that can enable the company to take advantage of softening of lead prices.
- The capex for FY 12 is expected to be Rs 270 crore.
- The promoters' holding remained same at 45.99% as on 31st Dec 2011. The promoters have not pledged any share.
The scrip closed at Rs 125.80, up by 4.6% on BSE on 20th Jan 2012.
Exide Industries: Standalone Results
| Particulars | 1112(3) | 1012 (3) | Var (%) | 1112(9) | 1012 (9) | Var (%) | 1103(12) | 1003(12) | Var (%) |
| Total Operating Income | 1246.73 | 1049.35 | 19 | 3663.41 | 3325.74 | 10 | 4577.50 | 3797.35 | 21 |
| OPM (%) | 13.9 | 15.0 | | 13.5 | 19.7 | | 19.4 | 23.0 | |
| OP | 172.70 | 157.39 | 10 | 493.65 | 653.95 | -25 | 887.19 | 874.25 | 1 |
| Other Income | 9.95 | 33.13 | -70 | 48.62 | 58.38 | -17 | 79.94 | 8.76 | 813 |
| PBDIT | 182.65 | 190.52 | -4 | 542.27 | 712.33 | -24 | 967.13 | 883.01 | 10 |
| Interest | 1.20 | 1.88 | -36 | 3.94 | 4.91 | -20 | 5.73 | 13.86 | -59 |
| PBDT | 181.45 | 188.64 | -4 | 538.33 | 707.42 | -24 | 961.40 | 869.15 | 11 |
| Depreciation / Amortization | 25.04 | 21.21 | 18 | 73.41 | 60.77 | 21 | 83.45 | 80.65 | 3 |
| PBT Before Forex Gain/loss | 156.41 | 167.43 | -7 | 464.92 | 646.65 | -28 | 877.95 | 788.50 | 11 |
| Forex Gain/Loss | -10.36 | 2.74 | PL | -18.77 | 14.86 | PL | 15.48 | 22.09 | -30 |
| PBT Before EO | 146.05 | 170.17 | -14 | 446.15 | 661.51 | -33 | 893.43 | 810.59 | 10 |
| EO | 0.00 | 0.00 | 0 | 0.00 | 46.93 | -100 | 46.93 | 0.00 | 100 |
| PBT after EO | 146.05 | 170.17 | -14 | 446.15 | 708.44 | -37 | 940.36 | 810.59 | 16 |
| Tax^ | 41.75 | 45.75 | -9 | 127.50 | 205.75 | -38 | 274.00 | 273.50 | 0 |
| PAT before Special Adjustments | 104.30 | 124.42 | -16 | 318.65 | 502.69 | -37 | 666.36 | 537.09 | 24 |
| EO | 0.00 | 0.00 | 0 | 0.00 | 0.00 | 0 | 0.00 | 0.00 | 0 |
| Net profit | 104.30 | 124.42 | -16 | 318.65 | 502.69 | -37 | 666.36 | 537.09 | 24 |
| EPS * | 4.9 | 5.9 | | 5.0 | 7.4 | | 7.4 | 6.3 | |
* Annualized on current equity of Rs 85 crore.
Face Value: Rs 1
^ Tax includes provision for Current tax, deferred tax, fringe benefit tax and net of reversals/credit
Var. (%) exceeding 999 has been truncated to 999
LP: Loss to Profit
PL: Profit to Loss
EO: Extraordinary items
EPS is calculated after excluding EO and relevant tax
Figures in Rs crore
Source: Capitaline Corporate Database |