Prabhat Dairy's Q4 PAT has grown remarkably

The Maharashtra-based integrated dairy company Prabhat Dairy has posted 16.32 per cent jump in consolidated net profit and stands at Rs 8.16 crore for the quarter ended March 31, 2016 as against Rs 7.01 crore in the corresponding quarter of the previous year.

The company’s consolidated revenue has grown by 8.65 per cent at Rs 308.27 crore in Q4FY16. Its consolidated operating profit (EBITDA) has marginally de-grown by 2.71 per cent at Rs 27.83 crore along with operating profit margin contracting by 105 bps for the current quarter, i.e. at 9.03 per cent. The company's gross margins are down by 250 basis points at 21.5 per cent in the fourth quarter of FY16 as the on-going drought has increased raw material procurement prices, which in turn has put pressure on the gross margins.

For the entire period of FY16, it has reported 5.63 per cent de-growth in consolidated net profit of Rs 24.53 crore, while its revenue has grown by 16.66 per cent at Rs 1,170.5 crore. Its consolidated operating profit (EBITDA) has grown by 15.20 per cent at Rs 119.25 crore along with operating profit margin contracting by 13 bps for the current year at 10.19 per cent. The company has reported around 15 per cent growth in gross profit (revenue, less cost of raw material consumed) and stands at Rs 262.27 crore in FY16 along with margin contracting by 34bps at 22.38 per cent.

As per the press release, the company’s management is confident of increasing its consumer reach and value added products; moreover in coming days they will be focusing on building consumer business. It further states that Capital expansion is on the cards for the company as its co-generation unit, which is to be commissioned in FY17, will help bring down utility cost.

On the valuation front, it is currently trading at 35.8 times, price to earnings (P/E) ratio per share of Rs 2.85 as on March 31, 2016. Currently stock is trading up by Rs 2.30 or 2.73 per cent at Rs 101.30 per share.