JK Tyre & Industries reported a consolidated net loss of Rs 198.85 crore in Q1 FY21 compared with net profit of Rs 16.91 crore in Q1 FY20.
Revenue from operations fell 56.1% to Rs 1130.80 crore in Q1 June 2020 from Rs 2575.39 crore in Q1 June 2019. India business revenues were at Rs 1067.39 crore (down 52.8% YoY) while the revenue from the Mexico business was at Rs 84.48 crore (down 75.1% YoY) in the first quarter.
The company recorded an exceptional expenditure of Rs 32.91 crore during the quarter. Of this, Rs 31.78 crore is on account of unfavourable foreign exchange fluctuation and Rs 1.13 crore is due to VRS.
Pre-tax loss in the June quarter stood at Rs 256.58 crore as compared to a pre-tax profit of Rs 20.69 crore reported in the same period last year. The company wrote back current taxes worth Rs 0.96 crore in Q1 FY21.
Commenting upon the results, Dr. Raghupati Singhania, chairman and managing director of the company said, "Economic activity, which came to a halt towards the end of the last quarter started slowly in mid-May. Our preparedness to meet replacement demand paid off well. As the lock down was progressively eased we were able to cater to market demand especially in the commercial segment.
In fact, the company has achieved the highest ever sales in the replacement market for its India Operations in June'20 which resulted in a growth of approximately 3% on YoY (year-on-year) basis. OEMs volumes are still reeling from the impact of COVID- 19, resulting in sluggish vehicle manufacturing.
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There was tremendous focus on conserving cash and aggressive cost savings. We would be able to sustain a good portion of these cost savings on an ongoing basis.
COVID-19 pandemic conditions in Mexico are far more severe. Though plants started operating from early June, the overall demand continues to be subdued."
JK Tyre and Industries manufactures a wide range of automobile tires, tubes and flaps. The company also operates a chain of tire outlets across the country which sell the company's tires in addition to providing a range of automotive services, including wheel alignment and tire changing.
The scrip rose 0.74% to currently trade at Rs 67.80 on the BSE. It traded in the range of 64.45 and 68.15 so ar during the day.
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