The company did not have a very good Q2 and Q3 turned around to be even worse. Its net profit fell 54% (YoY) at Rs.47.50 crore on a 28% decline in net sales at Rs.660.50 crore. Due to overall weakness in economy, not just domestic but globally too, the company saw a sharp drop in demand across all sectors and geographies. The demand drop coupled with inventory destocking at OEM level led to capacity utilization dropping from 70% in Q2 FY13 to around 55% in Q3 FY13. The demand drop was so much that the company undertook manufacturing cuts to reduce inventories and match production levels. Its EBIDTA margin dropped from 23.9% to 20.6%.

Its shipment tonnage declined by 19.1% & 32.4% on a QoQ and YoY respectively. The fall in the margins would have been much higher but for the cost control measures undertaken across areas during the quarter and the company expects full benefit to be visible in the coming quarters. In terms of geographic performance, Europe showed the highest YoY fall in revenue at 42.4%, next was Asia-Pacific, down 40.7%. America fell 24.2% and India fell 24%. So a fall across all. The company’s sales to the auto sector in India declined by 17.6% on a YoY and 11% on QoQ. The non-automotive sector has been down for the past three quarters. The company expects Q4 to also be more or less similar to Q3 due to subdued domestic and export demand. It hopes to see things improve only from Q1FY14.