SWARAJ ENGINES

It had been a flat if not consistent set of Q1FY13 numbers for the company and the previous quarter,Q4 had also been flat. In Q2FY13, YoY, the numbers are just about ok and sequentially, they remained flat. On a topline of Rs.121 crore, up 17% (YoY), it posted a net profit at Rs.14 crore, up 17%. Margins remained as around the same levels as that in Q1, OPM at 17.67% v/s 17.87% (QoQ) and NPM at 11.5% v/s 11.59%.

Mahindra & Mahindra holds 33.22% stake and Kirloskar Industries holds 17.39%. Making diesel engines, diesel engine components and spare parts, the company, had undertaken an expansion of its capacity to 75,000 engines in two phases. The first phase of 60,000 engines is almost complete and the total capacity is expected to go online by the end of 2012. This increased capacity will thus help the company post a better FY13. A debt free company, it funded its expansion via internal accruals. Its reserves as at 30th Sept 2012 stood at Rs.201 crore. Cash and cash equivalent is at Rs.71 crore. The fortunes of the company are directly linked with that of the agriculture sector, which is for tractors. Thus if the harvest is good, the company could have a much better H2.