Mcleod Russel India dropped 1.12% to Rs 225.45 at 12:30 IST on BSE after the company reported a net loss of Rs 23.22 crore in Q1 June 2015 compared with net loss of Rs 32 crore in Q1 June 2014.
The result was announced after market hours yesterday, 3 August 2015.
Meanwhile, the S&P BSE Sensex was down 127.55 points or 0.45% at 28,059.51.
On BSE, so far 25,042 shares were traded in the counter as against average daily volume of 37,913 shares in the past one quarter.
The stock hit a high of Rs 231 and a low of Rs 225.10 so far during the day. The stock had hit a 52-week high of Rs 314.80 on 19 September 2014. The stock had hit a 52-week low of Rs 202.35 on 29 January 2015.
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The stock had outperformed the market over the past one month till 3 August 2015, rising 2.43% compared with Sensex's 0.34% gain. The scrip had however underperformed the market in past one quarter, declining 5.86% as against Sensex's 4.35% gain.
The mid-cap company has equity capital of Rs 54.73 crore. Face value per share is Rs 5.
Mcleod Russel India's total income rose 56.66% to Rs 187.27 crore in Q1 June 2015 over Q1 June 2014.
The company has posted operating loss of Rs 23 crore in Q1 June 2015 against operating loss of Rs 39 crore in Q1 June 2014. This is mainly attributed to increase in production and higher sales. Sales are higher by 66% on higher volume by 42 lakh kg. Staff cost has increased by Rs 27 crore during the quarter on account of revision of wages in tea estates effective 1 January 2015. Consumption of raw material (cost of small growers' leaf) is higher by Rs 19 crore due to increase in volume. Depreciation is higher by Rs 5 crore due to changes as per Companies Act 2013.
Dry weather conditions in Kenya had positive impact on prices in Mombasa auctions. The prices up to June 2015 for African teas are higher by 30% as compared to last year. However, prices in India currently are lower by Rs 8 per kg due to sale of previous season teas and higher production. Tea prices for the company is lower by Rs 7 per kg for Q1 June 2015 as compared to last year. Increase in prices for the new season teas will reflect from second quarter onwards as first quarter has mainly accounted for sales of previous season teas. Sales quantity is higher by 42 lakh kg on higher production and sale of last season's production.
In its outlook, company said tea production in Kenya is reported to be lower by 50 million kg up to May 2015 as compared to last year due to dry weather. The company expects the production from Africa to remain lower for the rest of the season. Indian production is estimated to be higher by 30 million up to May 2015 as compared to last year due to favorable weather conditions. The company expect recovery of production in India to normal production of 1200 million kg for the full year assuming weather to remain favorable for the rest of the season.
Tea prices in African region have been higher by 30% up to June 2015 due to substantial loss of crop in Kenya. The prices are likely to improve further during the second half of the year as demand grows from Middle East and Pakistan. Tea prices in India are lower by Rs 10 per kg at auctions due to higher production. Tea prices are expected to move higher in line with the increase in prices in Africa. Exports for the year are likely to increase on stable geo political factors and lower production in Kenya. Increase in prices should start reflecting from the second quarter onwards. Cost during the year is expected to be higher by 13% in absolute terms due increase in wages and input costs.
Mcleod Russel is a producer of tea.
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