Recognised more as a tractor company, it posted a set of encouraging numbers for its first quarter ended 31st Dec 2012 (year ending on 30th Sept).  The company posted a net sales of Rs.1028 crore, up 25% QoQ but flat YoY, up by a miniscule 0.2%. But YoY EBITDA jumped up 74% and 14% QoQ at Rs.53 crore. A 2% cut in operating expenses YoY helped. EBITDA margin was at 5.15%, up 218 bps on YoY. And the company ended the quarter with a whopping 210% jump in net profit at Rs.28 crore. The company has stated that strict cost controls, inter group synergies, diversified product portfolio and improved product mix helped the bottomline.

A closer look at the segmental break-up shows that it is agriculture sector which helped post this extraordinary performance. It showed a 9% rise in revenue and its EBIT was up by a smart 70%. EBIT margin of this segment was up from 4.56% to 7.7% (YoY). On the other hand, auto ancillary products showed a 21% jump in revenue but had a loss, Railway equipment was also not good, showing a 7% drop in revenue and loss at EBIT level. Construction segment was the worst with a 38% drop in revenue and yet again a loss at EBIT. So clearly agriculture and cost measures helped. Interest cost was also down from 24 crore to Rs.21 crore in current Q1 (YoY). One has to now hope that in the coming months, infra, auto and railways improve. The company is sitting on a huge debt too. On an equity of Rs.119.26 crore, the annualised EPS is at Rs.9.44 (Rs.10 face value) and this discounts the current price by over 10 times.