Apollo Tyres has announced its Q1FY09 results. The company's Q1 net sales were up 23% at Rs 1075.86 crore versus Rs 874.15 crore.
Key takeaways from Apollo Tyres concall:
Its OPM was down at 10% versus 11%.
Its PAT was up 4% at Rs 48.63 crore versus Rs 46.76 crore.
It other Income down 83% at Rs 0.97 crore from Rs 5.77 crore.
Operating profit was up 9% at Rs 109.76 crore versus Rs 100.45 crore.
Interest cost down 6% at Rs 13.81 crore versus Rs 14.7 crore.
Employees cost up 15% at Rs 61.56 crore versus Rs 53.56 crore.
Depreciation up 12% at Rs 23.2 crore from Rs 20.7 crore.
Consolidated revenue reported at Rs 13.2 billion up 15% from Rs 11.5 billion.
Consolidated net profit after tax at Rs 586.6 million up 7.3% from Rs 546.4 million.
Standalone India Operations revenue at Rs 10.7 billion up 23% from Rs 8.7 billion.
Standalone India Operations net profit after tax at Rs 486.3 million up 4% from Rs 467.6 million.
Sharp rise in prices of raw materials precipitated price corrections across products.
In the 12 months between June 2007 and July 2008, natural rubber prices have gone up by 61%, while crude prices are up 111%. Crude-based derivatives like rubber chemicals are costlier by 60%, while an item like poly butadiene rubber is currently facing a production crisis, despite a price increase of 115%.
The unnatural rise in crude and natural rubber prices, have had a cascading impact across all raw materials.
Combined with prices, which are two or three times higher than what they were last year, the company is facing the added problem of certain essential crude-based raw materials being unavailable even at higher prices.
The management says that the current year would continue to be tough.
Volume growth YOY +14% ,QOQ +4% and also there is growth in size.
Raw material prices QOQ +13% ,expect another +15% hike in prices in Q2FY08 over Q1FY08.
Due to hike in Raw material cost pressure on profitability to remain therefore looking for price hike of abt 10% but if no price hike then OPM will fall by 300 bps..
Other income YOY Q1FY07 interest on income tax refund was huge figure, Q1FY08 sale of real estate property .
Capitalization on Fixed asset will be done in last quarter as expansion plans in Baroda and Chennai.
Demand not likely to come down unless economy really slows down.
Debt component reduced due to which interest cost reduced .
Dosemtic market share on production grounds 29%,passenger vehicle 17-18% inc. over 2% as compared to last year ,light vehicle 27-28% which remain stable as compared to last year.
Debt equity ratio below 0.5.
No deferring in expansion plans , funds from debt to be raised
