Jyothy Labs

Jyothi Laboratories announced a exuberant set of Q3FY14 numbers. The company which makes soaps and detergents under the brand name of Ujala, Henko, Pril, Margo; Home care products like the mosquito repellant Maxo and Exo scrubber and other brands like Fa and Neem, posted a whopping 63% (YoY) jump in net profit at Rs.27 crore. Net revenue rose 27% at Rs.297 crore. EBITDA margin though showed some pressure, coming in at 14.3% v/s 15.5% and this was on account of higher cost on raw materials and increased spend on advertising and sales promotion.

In terms of segment break-up, soaps and detergents continue to lead, showing a growth of 28% on the topline. Ujala remains a strong market leader with a lion’s share of the market at 72.5%. Home care products saw a growth of 26% while Fa and Neem, which contribute just around Rs.4 crore to the topline, showed a jump of 78%.

There are two great things which have happened in the company. Firstly, the company raised Rs.263 crore via preferential allotment of shares to promoter group and also raised Rs.400 crore through zero coupon non-convertible debentures and the proceeds of both have been used to reduce debt substantially. Interest cost has come down 28% (YoY) and this is expected to help the overall margins going ahead. Secondly, the company for 9MFY14 has posted a net profit at Rs.77 crore, which is already 75% higher than the 12MFY13 net profit of Rs.44 crore. Thus it is sure to end FY14 on a bumper note.