Moneycontrol Bureau
Two-wheeler maker Bajaj Auto's second quarter (July-September) net profit fell 29.4 percent to Rs 591 crore dented by one-time liability of Rs 340.29 related to national calamity contingent duty (NCCD). Profit in the year-ago period was Rs 837.1 crore.
On one-time liability, the company said it had filed a writ petition before the Uttarakhand High Court in October 2011, claiming benefit of exemption from payment of NCCD by Pantnagar plant. On October 9, 2014, the court ruled otherwise, it added.
Accordingly, the company recognised liability for the last seven and a half years (April 1, 2007 to September 30, 2014) aggregating to Rs 340.29 crore. This is a one time only charge and going forward, the monthly charge towards NCCD is expected to be around Rs 3 crore per month, it elaborated.
If one ignores exceptional item, profit after tax would have been at Rs 853 crore for the quarter.
Both bottomline as well as margin missed street expectations but topline was better than analysts' estimates.
According to CNBC-TV18 poll estimates, profit was expected at Rs 870 crore on revenue of Rs 5,790 crore for the quarter.
Revenue during the quarter grew by 15.2 percent to Rs 5,963.09 crore compared to Rs 5,174.9 crore in same quarter last year on high volume growth.
Sales volumes surged 9.4 percent in July-September quarter to 10.5 lakh units Y-o-Y due to strong exports and Discover 150 launch.
Operating profit declined 0.5 percent on yearly basis to Rs 1,127 crore and margin fell 290 basis points to 18.9 percent hit by higher other expenses and employee cost. Analysts had forecast of Rs 1,150 crore and 19.8 percent, respectively.
Other expenses jumped 32 percent year-on-year to Rs 531.9 crore and employee expenses increased 14.8 percent to Rs 210 crore in the quarter ended September 2014.
The two-wheeler maker has surplus cash and cash equivalents of Rs 8,313 crore as of September 2014.
The scrip of Bajaj Auto, which announced earnings after market hours, rose 2.5 percent to Rs 2,410.05 on the BSE.
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