Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Punjab Tractors: Short term hiccups - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Jan 30, 2002

    Punjab Tractors: Short term hiccups

    Punjab Tractor (PTRA) has reported a sharp fall in profits in the third quarter ended December 31, 2001. Pricing pressure and a subdued demand scenario have also exercised a downward pressure on margins.

    (Rs m) 3QFY01 3QFY02 Change 9mFY01 9mFY02 Change
    Net sales 2,690 2,325 -13.6% 7,297 6,915 -5.2%
    Other Income 3 -   20 37  
    Expenditure 2,139 1,874 -12.4% 5,881 5,572 -5.3%
    Operating Profit (EBDIT) 551 451 -18.1% 1,416 1,343 -5.2%
    Operating Profit Margin (%) 20.5% 19.4%   19.4% 19.4%  
    Interest - 30   - 68  
    Depreciation 43 43 0.0% 131 131 0.0%
    Profit before Tax 511 378 -26.0% 1,305 1,181 -9.5%
    Tax 153 112 -26.8% 391 351 -26.8%
    Profit after Tax/(Loss) 358 266 -25.7% 914 830 -9.2%
    Net profit margin (%) 13.3% 11.4%   12.5% 12.0%  
    No. of Shares (m) 60.8 60.8   60.8 60.8  
    Diluted Earnings per share* 23.6 17.5   20.1 18.2  
    P/E Ratio   9.7     9.3  

    The reasons for a 14% decline in sales are apparent. Though the company reported just a 3% fall in sales in the first half of the current fiscal as against a 16% fall in industry volumes, in the third quarter, tractor sales plummeted for PTRA. For October and November 2001, volume sales of PTRA fell by 23% and 21% respectively. But the company has managed to increase market share marginally in the first nine months of the current fiscal.

    For 9mFY02, net profits have come down by 9%. We expect the company to report a 6% fall in sales and a 11% fall in net profits for FY02. With a good kharif output in the current fiscal, tractor demand is expected to rise in the fourth quarter of the current year, albeit at a slower rate. We also expect the company to report higher growth in profits in FY03 on the back of a stable market share and higher margins. PTRA currently trades at Rs 170 implying a P/E multiple of 9x annualised nine months earnings. Considering the long term prospects of the industry coupled with its leadership position, PTRA is poised to capitalize on any upturn in tractor demand.



    Equitymaster requests your view! Post a comment on "Punjab Tractors: Short term hiccups". Click here!


    More Views on News

    Tata Motors Ltd: Another Disappointing Quarter, Management fails to Perform! (Quarterly Results Update - Detailed)

    Aug 14, 2017

    Tata Motors Ltd disappoints again for both India and JLR business. Management commentary indicates a slow year ahead.

    Maruti Suzuki Ltd: Bumpy First Quarter. GST dents Margins! (Quarterly Results Update - Detailed)

    Aug 2, 2017

    GST realted cost impacts Margins, Management expects good year ahead.

    Hero Motocorp Ltd: Riding on the Scooters Growth, Maintains Margins! (Quarterly Results Update - Detailed)

    Aug 1, 2017

    Good Recovery in the Scooters market, expects pick up in exports too.

    Bajaj Auto Limited: Recovery in Exports but Domestic Disappoints! (Quarterly Results Update - Detailed)

    Aug 1, 2017

    New Export Markets picking up, Management expects good recovery in domestic Three wheeler market.

    Bajaj Auto Limited: Finishes the Year with Headwinds. Poised for a Recovery Ahead? (Quarterly Results Update - Detailed)

    Jul 6, 2017

    Ends the year on a Flat note. Expects good recovery in the exports market.

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Important Innovation in Finance Since Gold Coins(Vivek Kaul's Diary)

    Aug 10, 2017

    Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms


    • Track your investment in PUNJAB TRACTORS with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
    • Add To MyStocks