Exide Aces Topline But Lags At Profits
Shailendra Lotlikar / 18 Jan 2013
It has seen a good volume growth which has also translated into a decent revenue growth during the December quarter. But margins have taken a huge beating following higher Lead prices. Demand from the replacement market remains robust but that from OEMs has remained weak. The stock was down 2.25% yesterday and is likely to see some more downside going forward.
Exide Industries announced its Q3FY13 results yesterday) post market hours. The company posted a strong volume and revenue growth. However, margins took a massive hit. According to the management, during the quarter under review, the replacement market for automotive batteries saw a volume growth of 25% on a YoY basis. However, due to a de-growth in the Original Equipment Manufacturer (OEM) segment, overall growth was only 13%. In the two-wheeler replacement market, it witnessed a 53% volume growth. Here too, OEM sales remained subdued, tracking industry growth.
| Q3FY13 | Q3FY12 | Change | |
|---|---|---|---|
| Rs Crore | % | ||
| Revenues | 1462.15 | 1246.08 | 17.34 |
| EBITDA | 164.68 | 162.53 | 1.32 |
| PAT | 146.85 | 146 | 0.58 |
| OPM | 11.26 | 13.04 | -178 BPS |
| NPM | 10.04 | 11.72 | -168 BPS |
Exide’s revenues grew by 17.34% on a YoY basis to Rs 1462.15 crore. Growth in EBITDA and PAT were flat at 1.32% and 0.58% respectively. The operating profit margin came down by 178 basis points to 11.26% and the net profit margin was down by 168 basis points to 10.04%.
Pressure on margins was led by a continuous upward movement in lead prices. This combined with a depreciating rupee cost the company significantly on the margin front.
However, having looked at the robustness in demand and thus its volume growth, the capital expenditure for FY13 is estimated to be around Rs 190 crore. In Q3FY13, it acquired a Home UPS manufacturing facility at Haridwar, Uttarakhand for a total consideration of Rs 6.36 crore.
Stock prices of Exide remained volatile through the day yesterday although the announcement was made post market hours. The counter witnessed a good volume and the stock price was down 2.25%.
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