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Bajaj Corp: Topline Impacted by Rural Slowdown - Views on News from Equitymaster
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Bajaj Corp: Topline Impacted by Rural Slowdown
Apr 18, 2016

We present herewith the March 2016 quarterly result analysis of Bajaj Corp.

Performance summary
  • Bajaj Corp Ltd (BCL) saw its revenue de-grow by 3.3% YoY in 4QFY16. Rural slowdown has taken a toll on the volumes, which declined by 5% YoY during the quarter. The volumes increased marginally by 4% YoY for the financial year ended March 2016.
  • The operating margin expanded by 1.7% YoY to 33.1% during the quarter on account of low cost of Light Liquid Paraffin (LLP). For the year ended March 2016, margins expanded by 2.5% YoY to 31.6%.
  • The net profit declined marginally by 0.7% YoY in 4QFY16. For the year ended March 2016, the net profits reported a growth of 14% on account of higher operating margins.
  • The company declared an interim dividend of Rs 11.5 per share in January 2016. At current market price, dividend yield turns out be at a healthy 2.9%. The interim dividend declared in January 2016 is to be considered as the final dividend.

    Standalone financial performance
    (Rs m) 4QFY15 4QFY16 Change FY15 FY16 Change
    Net sales 2,362 2,283 -3.3% 8,213 8,688 5.8%
    Expenditure 1,620 1,528 -5.7% 5,822 5,943 2.1%
    Operating profit (EBDITA) 741 756 1.9% 2,391 2,744 14.8%
    EBDITA margin (%) 31.4% 33.1% 29.1% 31.6%
    Other income 75 63 -16.8% 316 287 -9.1%
    Depreciation 10.6 12.3 16.1% 42 43 1.8%
    Interest 0.61 1.75 184.2% 1.00 2.09 109.9%
    Profit before tax 806 804 -0.2% 2,663 2,986 12.1%
    Exceptional Items 117 117 470 470
    Tax 144 147 1.9% 460 537 16.7%
    Effective tax rate 18% 18% 17% 18%
    Profit after tax/(loss) 544 540 -0.7% 1,733 1,979 14.2%
    Net profit margin (%) 23.0% 23.7% 21.1% 22.8%
    No. of shares (m) 147.5
    Diluted earnings per share (Rs)* 16.6
    Price to earnings ratio (x) 23.6

    (*On a trailing 12-month basis & excluding exceptional Items)

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