A flat year
Bharat Forge, the flagship company of the US$ 2.1 billion Kalyani Group and a leading global supplier of forged and machined components on a consolidated basis has posted Total Income and PAT after exceptional item reached Rs.4752 Crores & Rs 302 Crores, a growth of 11% and 4% respectively.
On a Standalone basis for the quarter ended Mar'08 the net sales revenue stood at Rs 579.67 crore which was 12% higher when compared with corresponding previous quarter last year. The OPM (Operating Profit Margin) Increased by 60 basis points to 24.8%. The subsequent Operating Profit for the quarter under review stood at Rs 143.65 crore that was 15% higher when compared with corresponding period last year. The ensuing PAT for the quarter under review stood at Rs 82.85 crore which was 29% higher on Y-o-Y basis.
Standalone
Quarterly Analysis
For the quarter ended Mar'08 the net sales revenue stood at Rs 579.67 crore which was 12% higher when compared with corresponding previous quarter last year. The OPM (Operating Profit Margin) Increased by 60 basis points to 24.8%. The subsequent Operating Profit for the quarter under review stood at Rs 143.65 crore that was 15% higher when compared with corresponding period last year.
Sales within India for the quarter ended Mar'08 stood at Rs 378.08 crore which was 4% higher when compared to corresponding previous quarter last year. Sales outside India for the quarter ended Mar'08 stood at Rs 246.46 crore indicating a growth of 23% when compared with corresponding period last year.
The Raw Material cost and manufacturing expenses decreased (as a % of sales net of stock adjustment) from 47.1% to 45.8% and from 16.9% to 16.4% respectively. The employee cost and other expenditure increased (as a% of sales net of stock adjustment) from 5.4% to 6.4% and from 6.7% to 7.1% respectively.
During the quarter ended Mar'08 the Other Income stood at Rs 12.64 crore indicating a fall of 36% when compared with corresponding period last year. Pending utilisation, funds raised out of FCCB and GDR have been temporarily placed in Fixed Deposits and investments, which generated an income aggregating Rs 10.605 crore during the quarter. During the quarter there was also an exchange loss of Rs 15.81 crore as compared to an exchange gain of Rs 2.09 crore during the corresponding period last year.
The resultant PBIDT for the quarter ended Mar'08 was Rs 140.49 crore which was 4% lower when compared to the corresponding previous quarter last year. The Interest cost and depreciation charges for the quarter ended Mar'08 increased by 7% and 33% respectively to Rs 24.91 crore and Rs 35.60 crore respectively when compared to the corresponding previous quarter last year.
Consequently, for the quarter ended Mar'08 the PBT before EO of Bharat Forge stood at Rs 79.98 crore indicating a fall of 17% when compared with the corresponding previous quarter last year.
During the quarter under review there was EO income stood at Rs 30.35 crore as compared to nil during the corresponding previous quarter last year. The Company, as a step to reorganise and restructure its holdings in its Global ventures has, during the year, sold its interest in BF Beteilingungs GmbH, a wholly owned subsidiary to CDP BF GmbH, also a wholly owned subsidiary, at a fair value determined by a valuer. Consequently, the Company has recognised a profit of Rs 30.35 crore
The ensuing PBT after EO stood at Rs 110.33 crore, which was 14% higher when compared with corresponding previous quarter last year. Provision for tax (including deferred tax and fringe benefit tax) for the quarter ended Mar'08 stood Rs 27.48 crore resulting in PAT of Rs 82.85 crore for the quarter ended Mar'08 as compared to Rs 64.28 crore in the quarter ended Mar'07 indicating a rise of 29%.
Year ended Mar'08
Bharat Forge, on a stand-alone basis has achieved Total Income of Rs 2,285 crore for the year ended March 31, 2008 up by 18% from Rs. 1,945 crore previous year. Net Profit of Rs 274 crore marks a jump of 14% over the previous year.
Export revenues demonstrated an impressive 28% growth in rupee terms & 40% in dollar terms to reach Rs 961 crores. US contributed 50% of exports, Europe 45% while Asia Pacific (including China) contributed the rest of BFL's exports.
For the year ended Mar'08 the net sales revenue stood at Rs 2196.50 crore which was 18% higher when compared with corresponding previous quarter last year. However the OPM (Operating Profit Margin) decreased by 130 basis points to 23.8%. The subsequent Operating Profit for the year under review stood at Rs 522.16 crore that was 12% higher when compared with corresponding period last year.
Sales within India for the year ended Mar'08 stood at Rs 1408.11 crore which was 11% higher when compared to corresponding period last year.
The Raw Material cost decreased (as a% of sales net of stock adjustment) from 45.8% to 45.6%. The employee cost and other expenditure increased (as a% of sales net of stock adjustment) from 5.7% to 6.5% and from 6.7% to 7.2% respectively.
During the year ended Mar'08 the Other Income stood at Rs 62.34 crore which was 20% lower when compared with corresponding period last year. Pending utilisation, funds raised out of FCCB and GDR have been temporarily placed in Fixed Deposits and investments, which generated an income aggregating Rs 52.267 crore during the year under review. During the year there was also an exchange gain of Rs 26.06 crore which was 948% higher when compared with corresponding previous quarter last year.
The subsequent PBIDT for the year under review stood at Rs 610.56 crore which was 11% higher when compared with corresponding period last year. The Interest expense and depreciation charges for the year under review stood at Rs 104.99 crore and Rs 138.94 crore respectively which was 28% and 39% respectively higher when compared with corresponding period last year.
Consequently, for the year ended Mar'08 the PBT before EO of Bharat Forge remained flat at Rs 366.63 crore. During the year under review there was EO income to the tune of Rs 30.35 crore as compared to an EO expense to the tune of Rs 6.75 crore during the corresponding period last year. During the year under review the Company, as a step to reorganise and restructure its holdings in its Global ventures has, during the year, sold its interest in BF Beteilingungs GmbH, a wholly owned subsidiary to CDP BF GmbH, also a wholly owned subsidiary, at a fair value determined by a valuer. Consequently, the Company has recognised a profit of Rs 30.35 crore
The ensuing PBT after EO stood at Rs 396.98 crore, which was 10% higher when compared with corresponding period last year. Provision for tax (including deferred tax and fringe benefit tax) for the year ended Mar'08 stood Rs 123.39 crore resulting in PAT of Rs 273.59 crore for the year ended Mar'08 as compared to Rs 240.95 crore in the year ended Mar'07 indicating a rise of 14%.
Consolidated results
Year ended Mar'08
On a consolidated basis for the year ended Mar'08 the net sales revenue stood at Rs 4652.28 crore which was 11% higher when compared with corresponding previous quarter last year. However the OPM (Operating Profit Margin) decreased by 40 basis points to 15.1%. The subsequent consolidated Operating Profit for the year under review stood at Rs 704.45 crore that was 9% higher when compared with corresponding period last year.
Sales within India for the year ended Mar'08 stood at Rs 1408.11 crore which was 11% higher when compared to corresponding period last year. Sales outside India for the year ended Mar'08 stood at Rs 3416.78 crore indicating a growth of 11% when compared with corresponding period last year.
During the year ended Mar'08 the Other Income stood at Rs 78.18 crore which was 15% lower when compared with corresponding period last year. During the year under review there was an exchange gain of Rs 21.12 crore which was 372% higher when compared with corresponding period last year.
The subsequent PBIDT for the year under review stood at Rs 803.75 crore which was 8% higher when compared with corresponding period last year. The Interest expense and depreciation charges for the year under review stood at Rs 126.94 crore and Rs 227.06 crore respectively which was 19% and 21% respectively higher when compared with corresponding period last year.
Consequently, for the year ended Mar'08 the PBT before EO of Bharat Forge remained flat at Rs 449.75 crore. During the year under review there was no EO item as compared to an EO expense to the tune of Rs 12.14 crore during the corresponding period last year. The ensuing PBT after EO stood at Rs 449.75 crore, which was 3% higher when compared with corresponding period last year.
Provision for tax (including deferred tax and fringe benefit tax) for the year ended Mar'08 stood Rs 158.94 crore resulting in PAT of Rs 290.81 crore for the year ended Mar'08 as compared to Rs 283.47 crore in the year ended Mar'08 indicating a rise of 3%. After Share of Profit of Associates and Minority Interest the Income attributable to the consolidated group stood at Rs 301.52 crore as compared to Rs 290.59 crore during the corresponding period last year indicating a growth of 4%.
Managements Comment
Commenting on the results of the company Mr. B N Kalyani, Chairman & Managing Director said that "the year 2008 has been full of challenges on both the domestic & export front. Two of our major markets, witnessed a slowdown which was compounded by the appreciating rupee. In these testing times, the company has posted moderate growth in the domestic market & an excellent growth of 28% in the exports revenue and is expanding our business in Europe by using strong customer relationship of our European operations. This success is attributable to the de-risked business model that BFL has systematically developed over the years. The strategy of de-risking was conceived with the intent to absorb such shocks arising from downturn in market cycles."
"In this year the company further strengthened its position in the non – auto space by creating a world class manufacturing platform which will start production in the coming year. This will further de-risk the business & accelerate growth thru new customers & market segments", he added.
Dividend
The company proposed a dividend of 175% (Rs 3.50 per Share)
Other Developments
Bharat Forge is planning to raise funds upto Rs.400 crores by means of rights issue of non-convertible debentures with warrants attached.
During the year ,the Company has made provision for the employee benefits in accordance with the AS-15( revised) . Further, in accordance with the transtional provision, the additional provision towards employee benefits amounting to Rs 25.1 crore net of deferred tax assets) has been adjusted from General Reserve.
Currently the stock is trading at Rs 293.90
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