Sintex Inds

Thanks to the lower forex loss, the company could show a robust performance for Q2FY13. Its forex loss on FCCB which was at Rs.60 crore in Q2FY12 and Rs.29 crore in Q1FY13, was down at Rs.4.86 crore in Q2FY13. Thus even though topline was  not all that great, up 3.6% on YoY and 11% QoQ at Rs.1,198.5, its net profit surged 86.5% (YoY) and 60% on a QoQ at Rs.72.35 crore. But for this lower forex loss, helped by the rupee appreciation, the company would have had a very muted performance, like in Q4FY12 and then in Q1FY13. Its interest outgo for the quarter was at Rs.36.08 crore v/s Rs.35.38 crore in current Q1. Total operating expense, on QoQ rose 12%.

The margins though continue to show the pressure. OPM was down 240 bps at 15.3% on a YoY. EBIDTA was also down 10.5% at Rs.189 crore. The three verticals – Building materials, custom moulding and textiles have down well, both YoY as well as QoQ. In terms of revenue growth, building materials rose 19%, custom moulding rose 4% and textiles rose 6%. But its monolithic segment continues to remain down, wherein YoY it was down 14%. The company’s monolithic segment is plagued by issues which are more macro – Euro debt crisis, rupee depreciation and policy paralysis and till these issues exist, the pressure will remain.  High interest outgo also remains a concern. Its total debt currently stands around Rs.2,900 crore of which Rs.1,600 crore debt is maturing for repayment in next one year and Rs 1,300 crore is the long-term debt which is repayable after one year. Out of this Rs 1,600 crore short-term debt, around Rs.1,200 crore debt is FCCB becoming due for payment in March 2013. The comp any hopes to grow by 10% this fiscal. The company has decided to issue up to 3 crore warrants on preferential basis to promoters.