Mahindra CIE Automotive Ltd's Q3CY18 standalone net profit rises 74% yoy to Rs43cr: Beats Estimates

The company’s standalone revenue in the period stood at Rs652cr, up 22% yoy and flat qoq.

Oct 16, 2018 06:10 IST India Infoline Research Team

Mahindra CIE Automotive Ltd Q3CY18

Standalone Results Q3CY18: (in Rs cr)

Q3CY18 YoY (%)
Revenue 652.45 21.7
EBITDA 80.31 36.8
EBITDA Margin (%) 12.3 136
Net Profit (adjusted) 42.58 73.8
***EBITDA margin change is bps

Mahindra CIE Automotive Limited (MCIE) reported a strong set of numbers for Q3CY18. Revenue in the quarter was up 22% yoy (flat qoq) at Rs652cr. EBITDA was up 37% yoy (down 2% qoq) at Rs80cr, while EBITDA margin expanded 136bps yoy (contracted 24bps qoq) to 12.3%. Standalone PAT surpassed the consensus estimate of Rs39cr and came in at Rs43cr in Q3CY18, up 74% yoy (down 3% qoq).

Other Highlights

  • The Board of Directors of MCIE recently approved the following restructuring plan:
  1. The merger of Bill Forge Pvt Ltd (wholly-owned subsidiary) with itself.
  2. Transfer of investment in Mahindra Forgings Europe AG (wholly-owned subsidiary) to CIE Galfor SA (wholly owned subsidiary).
  • MCIE reported a standalone tax rate of 34% in Q3CY18 against 37% in Q3CY17 and 35% in Q2CY18.

Conference Call Highlights

  • MCIE’s Mexico plant will ramp up to full capacity in CY19 with peak revenue of $30mn. Company will soon add third press line to meet orders.
  • The recently approved merger between MCIE and Bill Forge will close within six months and will lead to operational and administrative synergies.
  • New capacity is being added at CIE Forging and Metalcastello to cater to new orders.
  • MCIE’s UK forging operations will shut down due to low business visibility and transfer existing business to India.
  • Consolidated net debt as on September 30, 2018 was Rs750cr against Rs1,000cr in CY17.

Technical View:

Mahindra CIE Automotive Ltd ended at Rs266.95, up 2.25 points, or 0.85%, from its previous close of Rs264.70 on the BSE.
The scrip opened at Rs266 and has touched a high and low of Rs267.75 and Rs262.80, respectively. A total of 2,31,498 (NSE+BSE) shares were traded on the counter. The stock is currently trading below its 50 DMA.

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