Pidilite Inds

The largest adhesive maker of India, better recognized as ‘Fevicol’ company posted a declining bottomline for Q3FY14, with its consolidated net profit coming in at Rs.97 crore, down 18% (YoY). This fall was mainly on the back of higher write backs. During the quarter, the company has several FCCB conversions into shares and this resulted in write back of interest provision done on these FCCBs and also the reversal of exchange losses. This led to a write back, which ate away Rs.11 crore from the profits. It also had to provide for VRS at Rs.6 crore. If the net revenue for the quarter had not shown a 15% rise at Rs.1062 crore, the decline in bottomline would have been sharper.

Also adding to its woes this quarter was rise in raw material cost and 19% rise in other expenses, mainly on account of higher Advertising and Sales promotion costs. In terms of segment wise breakup, Consumer and Bazaar products showed a 15% rise in revenue though EBIT fell 2% and ditto for Industrial products, where topline rose 17% but EBIT fell 1%. In terms of geography, North America did better but South America continues to remain in losses and Middle East and Africa too remained under pressure. South & south East Asia was better though political tensions in this region did leave a telling effect on the sales.