Kwality scores well in Q3FY16

Kwality declared its Q3FY16 results. The company's revenue increased by 12.05 per cent to Rs 1441 crore in Q3FY16 as compared to same period in previous fiscal year. Its total expenditure increased by 11.97 per cent to Rs 1349 crore in Q3FY16 on a yearly basis. Kwality's total expenditure increased mainly due to 9.82 per cent increment in raw material prices to Rs 980 crore during the quarter.

Kwality's EBITDA increased by 13.22 per cent to Rs 92.69 crore in Q3FY16 as compared to same period in previous financial year. The company's EBITDA margin expanded by 6 basis points to 6.43 per cent in Q3FY16 on a yearly basis. Its interest cost increased by 10.8 per cent to Rs 38.69 crore and other income increased by 37.18 per cent to Rs 4.76 crore in Q3FY16 as compared to same period in previous fiscal year. Kwality's net profit increased by 3.57 per cent to Rs 37.42 crore in Q3FY16 on a yearly basis. However, the company's net profit margin contracted by 21 basis points to 2.6 per cent in Q3FY16 as compared to same period in previous financial year.

Considering nine months result, Kwality's net sales increased by 9.62 per cent to Rs 4285 crore in 9MFY16 as compared to same period in previous fiscal year. Its EBITDA too rose by 18.03 per cent to Rs 285 crore in 9MFY16 on a yearly basis. Its net profit also increased by 3.85 per cent to Rs 111 crore in 9MFY16 as compared to same period in previous financial year.

Kwality signed Akshay Kumar as its brand ambassador for entire range of dairy products during the December 2015 quarter. The company has signed the actor for a period of two years. Kwality's new facility at Palwal plant location is going as per schedule. The new plant will have a capacity to manufacture value added products like flavored milk; UHT products; Cheese variants; and table butter etc.

The share price of Kwality increased by 6.72 per cent on bourses in early trades; and is trading at Rs 113 on an intraday basis.

Kwality is India’s premier dairy foods company and has built leadership positions in branded and value-added markets across the dairy sector. The product range includes milk (bulk pouched and tetra pack); pure ghee; pure cow ghee; Livlite 85 per cent less cholesterol ghee; curd; skimmed milk powder; wake up creamer; chaach; lassi; and other dairy products under its various brands. It is in the process of launching value-added products such as flavoured milk; tetra pack milk; cheeses in numerous variants; and table butter. Kwality has six milk processing units in Uttar Pradesh; Haryana; and Rajasthan and a wide distribution network.