Supreme Industries rose 3.54% to Rs 1782.10 after the company's consolidated net profit surged 153% to Rs 312.28 crore on a 34.3% rise in net sales to Rs 1843.80 crore in Q3 December 2020 over Q3 December 2019.
The company's profit before tax stood at Rs 400.92 crore in Q3 December 2020, soaring 142.5% from Rs 165.3 crore in Q3 December 2019. Current tax expense climbed Rs 88.64 crore in Q3 December 2020 from Rs 41.9 crore in Q3 December 2019.Consolidated operating profit advanced 105% to Rs 455 crore in Q3 December 2020 from Rs 222 crore in Q3 December 2019.
The overall turnover of value added products increase to Rs 758 crore during the current quarter as compared to Rs 568 crore in the corresponding period of previous year achieving growth of 33%.
The company has cash surplus funds of Rs 432 crore as on 31 December, 2020 as against net borrowings of Rs 217 crore as on 31 March 2020.
Commenting on the company's performance, M. P. Taparia, MD of Supreme Industries said, Business situation has become normal in all the segments where company is operating. The company achieved a volume and value growth of 10% and 30% respectively in the 3rd quarter. The company's value added business has grown to Rs. 758 crores as compared to Rs 568 crore in comparable quarter of the previous year. The increase in volume sale supported by increase in the business of value added products have improved operating margin to 21.53% compared to 16.11% of the previous year in the same quarter. The OPM has also improved significantly due to inventory gain on account of rapid price increase of PVC resin to the extent of around Rs. 80 crores in the quarter. The Crop situation in the Country is normal, which has boosted the rural income. The Rabi crop sowing has also been done in a larger area than the previous year. Company enjoyed good demand for its products from rural market and Tier III and Tier IV cities. In the current quarter, the demand also got a fillip from the Housing market. Several Policy initiatives have facilitated brisk sale of ready to occupy housing units. Demand for Company's housing products has revived in Metro cities.
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He further added, The demand for Furniture and Material handling products were higher compared to previous year. With a better offtake of consumer durables, the Company enjoyed good demand for its' industrial components business. The company's Packaging segment working was affected due to increase in its raw material prices which could be passed over with a time lag, which may happen in the current quarter. Company has also introduced economy model of Tarpaulin also in Cross Laminated film segment having lower value addition. However, the overall demand for cross laminated film products for the year is expected at a higher level which may boost business to 21,000 MT in the year compared to 17,000 MT in the previous year.
Commenting on capex plan, he said, "The company's Capex plan is going smoothly. Along with carried forward investment commitment of Rs. 182 crores, the Company has made a plan to invest around Rs 400 crore in this year. The said investment is made mostly in its existing plants where additional construction activities are going on at Seven sites. The company is also now putting up new plants at three locations. Land for these plants have been already acquired at Orissa & Tamil Nadu. In Assam, the plant is being constructed on a lease agreement basis. The company aims to put all these new plants in production in the year 2021-22.
Supreme Industries is India's leading plastics product manufacturer, offering a wide and comprehensive range of plastic products in India.
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