Indo-National zooms 20%, Eveready Industries hits over 3-year high

Shares of non-durable household products companies Indo-National and Eveready Industries were in demand at the bourses on Thursday on expectation of strong March quarter (Q4FY21) results.

Indo-National shares were locked in 20 per cent upper circuit at Rs 1,049.40, also its 52-week high on the BSE. A combined 106,000 shares have changed hands, so far, and there were pending buy orders for around 20,000 shares on the NSE and BSE.

Indo-National is a leading consumer goods company with a portfolio comprising dry-cell batteries, flashlights, LED lights, Mosquito bats, DORCO Blades and electrical accessories.

Eveready Industries hit an over three-year high (highest level since April 2018) of Rs 338.70 after rising 7 per cent on the BSE in intra-day trade today. The stock hit an all-time high of Rs 465 on January 22, 2018.

Eveready is the country's market leader of batteries and flashlights. The company is selling more than 1.2 billion batteries and nearly 25 million flashlights. Apart from these, Eveready offers a basket of other products like LED, LED based Luminaires, GLS lamps & other lighting products and appliances. Eveready’s core categories of batteries and flashlights likely to witness a steady demand, given the sharp decrease in dumped imports from China and the disruptions caused to the unorganized market in the midst of the pandemic.

“The situation in the battery segment should continue to look positive as imports continue to remain low with the BIS standards having come into force - providing a level playing field to domestic manufacturers. The flashlight segment is also likely to remain steady as the rural economy revives from the adverse impact of the pandemic. Increased focus on rechargeable flashlights is also likely to benefit the segment,” Eveready said on outlook, while announcing December quarter (Q3FY21) results, on February 10, 2021.

The lighting segment could partially recover from a weak consumption demand and supply constraints arising out of the pandemic. The situation is likely to improve in the forthcoming quarters as normalcy is restored in demand and as supply sources are stabilized. Given the outlook, the Company Is expected to maintain high operating margins in the forthcoming quarters, Eveready had said.

For Q3FY21, Eveready had reported 89 per cent year on year (YoY) jump in operating Ebitda (earnings before interest, taxes, depreciation, and amortisation) at Rs 68.40 crore against Rs 36.15 crore in Q3FY20. Operating Ebitda margins improved to 20.1 per cent from 11.4 per cent in a year ago quarter.

Higher margins were due to a better turnover mix towards the more profitable segments of batteries and flashlights. This coupled with lower distribution cost, lower promotional spends and lower overheads as the various establishments of the Company continued to be run in a restricted manner in the COVID environment, enhanced profitability, the company said.