Finolex Cable

Better cost management, product mix and higher volumes helped the company end Q1FY17 with a 55% (YoY) jump up in net profit at Rs.70 crore despite a 2% drop in net sales at Rs.593 crore. The drop in topline was on account of fall in realisations; commodity prices during the quarter fell 18% but this was supported by a 13% rise in light duty electrical cable volumes, 29% in higher voltage power cables and 25% growth in communication cables.

Raw material cost fell 7% and advertising/selling costs were down 20%. This lower cost and 55% increase in other income helped overall earnings. EBITDA was up 27% at Rs.91 crore and margins showed a good jump from 11.97% to 15.27%. A 6% drop in interest cost also added. 75% of the total revenue comes from electrical cables and its topline fell 6% though EBIT rose 5%. Communication Cables contributes 13% to the total revenue and its topline rose 57% and EBIT showed a good 140% jump. Copper rods, contributing 11% to total revenue did not do well with a 57% fall in topline and posting a loss at EBIT levels.

Equity stands at Rs.30.59 crore and EPS for the quarter came in at Rs.4.60 (FV of Rs.2). The company has already launched its range of fans and it expects this vertical to start contributing in coming months. The company plans to launch Miniature Circuit Breaker (MCBs) in Q2.