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Pidilite Industries

26 Jan 2022 , 08:41 AM

Pidilite Industries consolidated net sales increased 24% to Rs 2850.72 crore in Q3FY22 compared to Q3FY21. Sales of Consumer & Bazaar Products segment has gone up 22.48% to Rs 2,264.52 crore (accounting for 77.99% of total sales). Sales of Others segment rose 68.12% to Rs 20.46 crore (accounting for 0.70% of total sales). Sales of Business to Business segment has gone up 30.22% to Rs 618.64 crore (accounting for 21.31% of total sales).

Operating profit margin has declined from 27.87% to 19.26%, leading to 14.32% decline in operating profit to Rs 549.03 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 40.31% to 50.18%. Purchase of finished goods cost rose from 6.19% to 6.47%. Employee cost decreased from 11.06% to 9.77%. Other expenses fell from 15.20% to 14.43%.

Other income fell 74.63% to Rs 5.17 crore. PBIDT fell 16.18% to Rs 554.2 crore. Profit before interest, tax and other unallocable items (PBIT) has slumped 14.09% to Rs 601.72 crore. PBIT of Consumer & Bazaar Products segment fell 12.75% to Rs 562.88 crore (accounting for 93.55% of total PBIT). PBIT of Others segment fell 123.08% to Rs -1.16 crore (accounting for -0.19% of total PBIT). PBIT of Business to Business segment fell 28.32% to Rs 40.00 crore (accounting for 6.65% of total PBIT).

PBIT margin of Consumer & Bazaar Products segment fell from 34.89% to 24.86%. PBIT margin of Others segment fell from negative 4.27% to negative 5.67%. PBIT margin of Business to Business segment fell from 11.75% to 6.47%. Overall PBIT margin fell from 29.98% to 20.72%.

Provision for interest fell 10.94% to Rs 10.75 crore. PBDT fell 16.28% to Rs 543.45 crore. Provision for depreciation rose 22.19% to Rs 60.46 crore.

Profit before tax down 19.45% to Rs 482.99 crore. Share of profit/loss was 136.08% higher at Rs 3.73 crore. Provision for tax was expense of Rs 127.48 crore, compared to Rs 154.8 crore. Effective tax rate was 26.19% compared to 25.75%.

Minority interest decreased 83.70% to Rs 0.75 crore. Net profit attributable to owners of the company decreased 18.86% to Rs 358.49 crore.

Promoters stake was 69.98% as of 31 December 2021 compared to 70.19% as of 31 December 2020.

Commenting on the quarter performance, Mr. Bharat Puri, Managing Director, Pidilite Industries Ltd, said:

?This quarter registered strong broad-based volume and value growth across categories and businesses. Continued, unprecedented inflation in input costs necessitated calibrated pricing actions as well as the need to manage costs aggressively to maintain margins in a healthy range. Going forward, we expect near-term demand conditions to be a little more challenged, given the disruptions as a result of the pandemic as well as input inflation to continue. However, we see demand conditions improving as well as input costs moderating by the end of the current quarter/beginning of the new financial year. We remain confident of the medium to long-term potential of the Indian home improvement sector and in our ability to deliver profitable volume growth.?

For year-to-date (YTD) results analysis

Net sales of Pidilite Industries has increased 46.60% to Rs 7413.86 crore. Sales of Consumer & Bazaar Products segment has gone up 44.20% to Rs 5,881.18 crore (accounting for 77.80% of total sales). Sales of Others segment rose 112.64% to Rs 44.93 crore (accounting for 0.59% of total sales). Sales of Business to Business segment has gone up 56.96% to Rs 1,633.04 crore (accounting for 21.60% of total sales).

Operating profit margin has declined from 24.12% to 19.51%, leading to 18.56% rise in operating profit to Rs 1,446.21 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 38.57% to 48.52%. Purchase of finished goods cost rose from 5.91% to 6.18%. Employee cost decreased from 14.34% to 11.15%. Other expenses fell from 16.82% to 14.80%.

Other income fell 59.42% to Rs 25.19 crore. PBIDT rose 14.78% to Rs 1471.4 crore. Profit before interest, tax and other unallocable items (PBIT) has jumped 18.60% to Rs 1,622.95 crore. PBIT of Consumer & Bazaar Products segment rose 16.09% to Rs 1,516.00 crore (accounting for 93.41% of total PBIT). PBIT of Others segment rose 58.77% to Rs -1.34 crore (accounting for -0.08% of total PBIT). PBIT of Business to Business segment rose 64.77% to Rs 108.29 crore (accounting for 6.67% of total PBIT).

PBIT margin of Consumer & Bazaar Products segment fell from 32.02% to 25.78%. PBIT margin of Others segment rose from negative 15.38% to negative 2.98%. PBIT margin of Business to Business segment rose from 6.32% to 6.63%. Overall PBIT margin fell from 26.62% to 21.47%.

Provision for interest rose 9.87% to Rs 32.73 crore. PBDT rose 14.90% to Rs 1438.67 crore. Provision for depreciation rose 23.66% to Rs 177.42 crore.

Profit before tax grew 13.77% to Rs 1,261.25 crore. Share of profit/loss was 150.38% higher at Rs 6.66 crore. Provision for tax was expense of Rs 315.5 crore, compared to Rs 292.61 crore. Effective tax rate was 24.88% compared to 26.33%.

Minority interest increased 87.38% to Rs -0.80 crore. Net profit attributable to owners of the company increased 15.54% to Rs 953.21 crore.

Promoters stake was 69.98% as of 31 December 2021 compared to 70.19% as of 31 December 2020 .

Full year results analysis

Net sales (including other operating income) of Pidilite Industries has declined 0.02% to Rs 7292.71 crore. Sales of Consumer & Bazaar Products segment has gone up 4.22% to Rs 5,808.88 crore (accounting for 78.26% of total sales). Sales of Others segment fell 49.60% to Rs 38.53 crore (accounting for 0.52% of total sales). Sales of Business to Business segment has gone down 12.32% to Rs 1,575.40 crore (accounting for 21.22% of total sales). Inter-segment sales came down from Rs 152.64 crore to Rs 130.10 crore.

Operating profit margin has jumped from 21.61% to 23.05%, leading to 6.64% rise in operating profit to Rs 1,680.62 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 41.22% to 40.72%. Purchase of finished goods cost rose from 5.27% to 6.44%. Employee cost increased from 12.75% to 13.24%. Other expenses fell from 19.09% to 16.93%. Cost of Sales fell from 46.78% to 45.56%. Inventories cost rose from 0.29% to 1.60%.

Other income fell 46.86% to Rs 79.4 crore. Profit before interest, tax and other unallocable item (PBIT) has jumped 4.21% to Rs 1,889.92 crore. PBIT of Consumer & Bazaar Products segment rose 14.45% to Rs 1,773.63 crore (accounting for 93.85% of total PBIT). PBIT of Others segment fell 59.56% to Rs -1.84 crore (accounting for -0.10% of total PBIT). PBIT of Business to Business segment fell 56.01% to Rs 118.13 crore (accounting for 6.25% of total PBIT).

PBIT margin of Consumer & Bazaar Products segment rose from 27.80% to 30.53%. PBIT margin of others segment rose from negative 5.95% to negative 4.78%. PBIT margin of Business to Business segment fell from 14.95% to 7.50%. Overall PBIT margin rose from 24.35% to 25.46%.

Provision for interest increased 10.80% to Rs 37.23 crore. Loan funds rose to Rs 322.29 crore as of 31 March 2021 from Rs 280.59 crore as of 31 March 2020. Inventories rose to Rs 1,234.15 crore as of 31 March 2021 from Rs 929.47 crore as of 31 March 2020. Sundry debtors were higher at Rs 1,321.02 crore as of 31 March 2021 compared to Rs 1,088.50 crore as of 31 March 2020. Cash and bank balance declined from Rs 703.25 crore as of 31 March 2020 to Rs 451.46 crore as of 31 March 2021. Investments declined from Rs 1,186.19 crore as of 31 March 2020 to Rs 515.97 crore as of 31 March 2021.

Provision for depreciation increased 18.09% to Rs 200.66 crore. Fixed assets declined from Rs 1,882.01 crore as of 31 March 2020 to Rs 1,736.71 crore as of 31 March 2021. Intangible assets increased from Rs 184.03 crore to Rs 2,975.08 crore.

Profit before tax grew 0.01% to Rs 1,522.13 crore. Share of profit/loss was 31.35% higher at Rs 3.98 crore.

Provision for tax was expense of Rs 396.36 crore, compared to Rs 347.72 crore. Effective tax rate was 26.03% compared to 23.66%. The company reported EO expense of Rs 3.62 crore representing impairment in value of investment compared to EO expense of Rs 55.19 crore related to impairment loss on fair value of Assets held for Sale pertaining to Synthetic Elastomer Project. PBT after EO rose 4% to Rs 1522.49 crore.

Net profit attributable to owners of the company increased 1.32% to Rs 1,131.21 crore.

Promoters stake was 70.16% as of 31 March 2021 compared to 69.92% as of 31 March 2020.

Cash flow from operating activities increased to Rs 1,392.13 crore for year ended March 2021 from Rs 1,279.55 crore for year ended March 2020. Cash flow used in acquiring fixed assets during the year ended March 2021 stood at Rs 353.76 crore, compared to Rs 467.13 crore during the year ended March 2020.

The scrip is currently trading at Rs 2589

Pidilite Industries : Consolidated Results
Particulars	2112 (03)	2012 (03)	Var.(%)	2112 (09)	2012 (09)	Var.(%)	2103 (12)	2003 (12)	Var.(%)
Net Sales	2,850.72	2,299.02	24	7,413.86	5,057.19	47	7,292.71	7,294.47	0
OPM (%)	19.3	27.9		19.5	24.1		23.1	21.6
OP	549.03	640.82	-14	1,446.21	1,219.83	19	1,680.62	1,576.02	7
Other Inc.	5.17	20.38	-75	25.19	62.07	-59	79.4	149.43	-47
PBIDT	554.2	661.2	-16	1,471.40	1,281.90	15	1,760.02	1,725.45	2
Interest	10.75	12.07	-11	32.73	29.79	10	37.23	33.6	11
PBDT	543.45	649.13	-16	1,438.67	1,252.11	15	1,722.79	1,691.85	2
Depreciation	60.46	49.48	22	177.42	143.47	24	200.66	169.92	18
PBT	482.99	599.65	-19	1261.25	1108.64	14	1522.13	1521.93	0
Share of Profit/(Loss) from Associates	3.73	1.58	136	6.66	2.66	150	3.98	3.03	31
PBT before EO	486.72	601.23	-19	1267.91	1111.3	14	1526.11	1524.96	0
EO Income	0	0	–	0	0	–	-3.62	-55.19	93
PBT after EO	486.72	601.23	-19	1267.91	1111.3	14	1522.49	1469.77	4
Taxation	127.48	154.8	-18	315.5	292.61	8	396.36	347.72	14
PAT	359.24	446.43	-20	952.41	818.69	16	1126.13	1122.05	0
Minority Interest (MI)	0.75	4.6	-84	-0.8	-6.34	87	-5.08	5.63	LP
Net profit	358.49	441.83	-19	953.21	825.03	16	1131.21	1116.42	1
EPS (Rs)*	#	#		#	#		22.3	22.8
Notes
* EPS is on current equity of Rs 50.82 crore, Face value of Rs 1, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

Pidilite Industries : Consolidated Segment Results
	% of (Total)	2112 (03)	2012 (03)	Var.(%)	% of (Total)	2112 (09)	2012 (09)	Var.(%)	% of (Total)	2103 (12)	2003 (12)	Var.(%)
Sales
Consumer & Bazaar Products	78	2,264.52	1,848.89	22	78	5,881.18	4,078.61	44	78	5,808.88	5,573.85	4
Others	1	20.46	12.17	68	1	44.93	21.13	113	1	38.53	76.45	-50
Business to Business	21	618.64	475.08	30	22	1,633.04	1,040.40	57	21	1,575.40	1,796.81	-12
Total Reported Sales	100	2,903.62	2,336.14	24	100	7,559.15	5,140.14	47	100	7,422.81	7,447.11	0
Less: Inter segment revenues		52.90	37.12	–		145.29	82.95		130	152.64	-14.77
Net Sales		2,850.72	2,299.02	26		7,413.86	5,057.19	49		7,292.71	7,294.47	0
PBIT
Consumer & Bazaar Products	94	562.88	645.12	-13	93	1,516.00	1,305.92	16	94	1,773.63	1,549.64	14
Others	0	-1.16	-0.52	-123	0	-1.34	-3.25	59	0	-1.84	-4.55	60
Business to Business	7	40	55.8	-28	7	108.29	65.72	65	6	118.13	268.54	-56
Total PBIT	100	601.72	700.4	-14	100	1,622.95	1,368.39	19	100	1,889.92	1,813.63	4
Less : Interest		10.75	12.07	-11		32.73	29.79	10		37.23	33.6	11
Add: Other un-allcoable		-104.25	-87.1	-20		-322.31	-227.3	-42		-330.2	-310.26	-6
PBT		486.72	601.23	-19		1,267.91	1,111.30	14		1,522.49	1,469.77	4