S H Kelkar and Company (SHK) recorded a consolidated sales of about Rs 355 crore, despite a challenging domestic macro-environment owing to lockdowns and restrictions.
Client engagements and wins continued to remain at healthy levels across FMCG customers during the quarter. Following easing of restrictions and lockdowns from June 2021 onwards, S H Kelkar and Company (SHK) is witnessing recovery in demand and normalisation in consumer sentiments. Creative Flavours and Fragrances (CFF), the company's 100% wholly-owned subsidiary, delivered a healthy performance during the quarter on the back of improved demand and volume offtake in key markets.On a like-to-like basis, the revenues stood at Rs 277 crore. While the company witnessed moderate inflation in raw materials, it was able to maintain gross margins through inventory management and price hikes. Profitability margins were within a steady range considering the impact on revenues on account of the second wave of COVID-19 pandemic.
On the balance sheet front, S H Kelkar and Company's net debt position stood at Rs 386 crore as on 30 June 2021 as compared to Rs 380 crore as on 31 March 2021. Payment for acquisition of Nova in April 2021 coupled with slower collections due to lockdowns and restrictions in the domestic market during the quarter led to a slight increase in debt.
Going forward, SHK has no major capex plans on hand and the focus remains on healthy free cash flow generation. Health & safety of its employees, business partners and communities is one of the key focus areas for SHK.
Meanwhile, on 29 June 2021, Kedar Vaze and Keva Constructions, promoter group of SHK, had pledged 25 lakh shares each, representing 3.5% of the total number of fully paid up equity shares of SHK. The pledge of shares by the promoter group is towards certain personal requirements. The promoter group does not anticipate pledging of additional shares and is committed to progressively reducing the pledged position in due course. The pledge conveys sustained commitment without dilution of interest.
SHK's consolidated net profit soared 233.70% to Rs 40.11 crore on a 47% rise in net sales to Rs 396.50 crore in Q4 FY21 over Q4 FY20.
SHK has a long standing reputation in the fragrance industry developed in 96 years of experience. Its fragrance products and ingredients are used as a raw material in personal wash, fabric care, skin and hair care, fine fragrances and household products. Its flavour products are used as a raw material by producers of baked goods, dairy products, beverages and pharmaceutical products.
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Shares of SHK declined 2.35% to Rs 178.50 on BSE. The stock hovered in the range of Rs 178.15 to Rs 181 so far.
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