Goodlass: The auto effect - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Goodlass: The auto effect

Jan 31, 2001

Goodlass Nerolac has reported a 48% drop in net profits for the third quarter ended 31st December 2000 to Rs 52 m. The slow down in automobile sales has had a clear impact on the company's sales in the third quarter (Goodlass is the main supplier to Maruti and Telco). While sales grew marginally by 4.7% in 3QFY01 to Rs 1,481 m, operating margin has declined sharply from 11.0% in 3QFY00 to 7.8% in 3QFY01.

(Rs m) 3QFY00 3QFY01 Change
Sales 1,416 1,481 4.7%
Other Income 39 29 -26.2%
Expenditure 1,260 1,366 8.4%
Operating Profit (EBDIT) 155 116 -25.6%
Operating Profit Margin (%) 11.0% 7.8%  
Interest 15 18 24.7%
Depreciation 35 53 50.9%
Profit before Tax 145 74 -49.2%
Tax 46 22 -52.4%
Profit after Tax/(Loss) 99 52 -47.8%
Net profit margin (%) 7.0% 3.5%  
No. of Shares (eoy) (m) 15.3 15.3  
Diluted number of shares 15.3 15.3  
Earnings per share* 25.8 13.5  
*(annualised)      

Though the company resorted for a marginal increase in paint prices, higher inflation coupled with a substantial rise in basic rutile titanium dioxide prices could not neutralise the effect at the operating level. But, if we were to consider the first nine months financial performance, things are not looking that ominous.

While net sales has gone up by 12.4% from Rs 3,880 m to Rs 4,361 m, operating margins declined marginally to 9.1% in the first nine months of the current year from 9.2% in the corresponding period of the previous year. Remember, the company posted a 100% rise in net profit in 2QFY01 with a sharp increase in operating margins.

The rise in depreciation is understandable as the company has been increasing the number of dealer tinting machines in the current year as a step towards increasing the contribution from decorative paint segment. However, lower tax provisioning has prevented the bottomline from a huge drop.

The stock is trading at Rs 134 at a P/E multiple of 7.2x the annualised first nine months earnings.


Equitymaster requests your view! Post a comment on "Goodlass: The auto effect". Click here!

  

More Views on News

KANSAI NEROLAC Announces Quarterly Results (1QFY21); Net Profit Down 71.1% (Quarterly Result Update)

Aug 21, 2020 | Updated on Aug 21, 2020

For the quarter ended June 2020, KANSAI NEROLAC has posted a net profit of Rs 427 m (down 71.1% YoY). Sales on the other hand came in at Rs 6 bn (down 59.1% YoY). Read on for a complete analysis of KANSAI NEROLAC's quarterly results.

KANSAI NEROLAC Announces Quarterly Results (4QFY20); Net Profit Down 23.0% (Quarterly Result Update)

May 7, 2020 | Updated on May 7, 2020

For the quarter ended March 2020, KANSAI NEROLAC has posted a net profit of Rs 715 m (down 23.0% YoY). Sales on the other hand came in at Rs 10 bn (down 13.5% YoY). Read on for a complete analysis of KANSAI NEROLAC's quarterly results.

KANSAI NEROLAC 2018-19 Annual Report Analysis (Annual Result Update)

May 30, 2019 | Updated on May 30, 2019

Here's an analysis of the annual report of KANSAI NEROLAC for 2018-19. It includes a full income statement, balance sheet and cash flow analysis of KANSAI NEROLAC. Also includes updates on the valuation of KANSAI NEROLAC.

More Views on News

Most Popular

How the 8-Year Cycle Can Help Identify Multibaggers (Fast Profits Daily)

Sep 11, 2020

This is how you can apply the greed and fear cycle in the market to pick stocks.

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

This Could Be the Best September for Auto Stocks (Profit Hunter)

Sep 11, 2020

Here's why I think this month could be a great for auto stocks.

What Do the Charts Say About Buying Smallcaps Now? (Fast Profits Daily)

Sep 18, 2020

Everyone seems to be excited about buying smallcaps now...but is it the right thing to do? What do the charts tell us? Find out in this video...

More

Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms

KANSAI NEROLAC SHARE PRICE


Sep 23, 2020 (Close)

TRACK KANSAI NEROLAC

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

MORE ON KANSAI NEROLAC

KANSAI NEROLAC - ASIAN PAINTS COMPARISON

COMPARE KANSAI NEROLAC WITH

MARKET STATS