This Tata company has posted a set of encouraging results for the second quarter ended 30th September 2009. Net sales was up 11% on a YoY at Rs.1098 crore. Operating profit grew 52% at Rs.133 crore. Net profit was up 50% at Rs.92 crore. Cost cutting in manufacturing helped boost the margins.
Its Electro-mechanical projects and services unit showed a 22% rise in revenue at Rs.769 crore. On the other hand, engineering unit continued to feel the brunt of the recession and poor off take of capital goods led to this unit show a 28% lower growth in revenue. This is also the unit which supplies textile machineries and given the state of the textile sector, naturally this unit has taken a hit. The Unitary cooling system unit showed a 27% rise in revenue.
The company procured raw materials till Q2 at prices which were negotiated at the beginning of the year and now, from Q3 onwards, the higher costs would have some impact on the costs.
45-50% is the contribution of international business to overall revenue and profit. The Abu Dhabi Formula One project executed by Voltas is to be inaugurated in November and Burj Dubai, the largest building in the world, would be inaugurated in December.
The company electro-mechanical unit has an order book of Rs.4359 crore of which 25% is from the Middle East. The company plans to increase its presence in the Middle East, especially in UAE and Qatar.
The company has on August 25, 2009 increased its stake in Rohini Industrial Electricals, a subsidiary of the company, for a consideration Rs.23.56 crore from 51% to 67.33%.
Demand continues to remain low and the company has stated that inquiry is yet to pick up. Q4 is expected to be much better. Usually for the company, Q1 and Q4 are the best seasons so even on a cyclical basis, its best to wait out Q3. The aim of the company is to more or less maintain growth at the present levels in Q3.
Its Electro-mechanical projects and services unit showed a 22% rise in revenue at Rs.769 crore. On the other hand, engineering unit continued to feel the brunt of the recession and poor off take of capital goods led to this unit show a 28% lower growth in revenue. This is also the unit which supplies textile machineries and given the state of the textile sector, naturally this unit has taken a hit. The Unitary cooling system unit showed a 27% rise in revenue.
The company procured raw materials till Q2 at prices which were negotiated at the beginning of the year and now, from Q3 onwards, the higher costs would have some impact on the costs.
45-50% is the contribution of international business to overall revenue and profit. The Abu Dhabi Formula One project executed by Voltas is to be inaugurated in November and Burj Dubai, the largest building in the world, would be inaugurated in December.
The company electro-mechanical unit has an order book of Rs.4359 crore of which 25% is from the Middle East. The company plans to increase its presence in the Middle East, especially in UAE and Qatar.
The company has on August 25, 2009 increased its stake in Rohini Industrial Electricals, a subsidiary of the company, for a consideration Rs.23.56 crore from 51% to 67.33%.
Demand continues to remain low and the company has stated that inquiry is yet to pick up. Q4 is expected to be much better. Usually for the company, Q1 and Q4 are the best seasons so even on a cyclical basis, its best to wait out Q3. The aim of the company is to more or less maintain growth at the present levels in Q3.
Source: Internet (By S P Tulsian)
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