The performance in Q1Fy13 was not so good and things seem to have got worse in Q2. The numbers, sequentially and YoY have slipped further. Net profit at Rs.2.15 crore was down 61% (QoQ) and 62% (YoY). Though the company showed a marginal rise in net sales at Rs.60 crore, the operating expenses took its tool. Its main raw material is copper scrap which is procured either domestically or imported and most are derivatives of crude oil. Price of copper was high till end of Q3 and in Q4, the prices started showing signs of easing. Crude has also come down substantially and this reflected in raw material costs in Q2, which QoQ was down 3%. But this was offset by the 6% rise in power and fuel costs.

The bottomline would have been much lower but for the 30% (QoQ) drop in interest outgo and tax was also lower by 58%. This company manufactures pigments for the chemical industry and it supplies to leading companies like BASF, Clariant. As at 30th Sept 2012, promoters hold 61.48% and interestingly, Clariant Chemicals holds 5.86% in the company. The company derives more that 90% of its total revenue from overseas market and thus fluctuation in foreign exchange, increasing raw material prices and global slowdown remain major threats to the company. Given the volatile rupee currently, Q3 could be tumultuous.