Kajaria Ceramics Q3FY14 Net Profit Up By 18%

Kajaria Ceramics (KCL) has performed well in December quarter on the back of rising tiles demand. Its consolidated revenue from operations showed a growth of 5.4% and reached to Rs 440.43 crore for Q3FY14. The net profit witnesses a better growth of 17.6% on yearly basis in the same period.

The topline on consolidated basis increased on account of increase in net sales during the quarter on YoY basis. Though, the company's total operating expenses increased by 4.7% to Rs 373.97 crore on yearly basis, it has declined as a proportion of revenue in comparison with the previous year revenue in the similar quarter. The primary reason behind this is that the company's cost of material has reduced. Therefore, the company's EBITDA has gone up by 9.5% to Rs 66.46 crore against Rs 60.68 crore in Q3FY13. The EBITDA margin of the company too has improved by 56 basis points and stands at 15.1%.

Net profit of the company increased to Rs 29.35 crore over Rs 24.95 crore in Q3FY13.

Further, KCL has plans to do a capital expenditure of about Rs 425 crore over the financial year FY13 to FY16. This investment will help company to have revenue of over Rs 3000 crore by FY16. In addition, the Joint Ventures of KCL with the private firms - Jaxx Vitrified and Cosa Ceramics, having annual capacity of 5.7 million square meters (MSM) and 2.7 MSM respectively, will increase the KCL's production capacity. Hence, with the increased capacities of its vitrified tiles and strong demand in the market, we expect KCL to deliver strong growth over the medium term.