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Vinati Organics: A Good Quarter - Views on News from Equitymaster
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Vinati Organics: A Good Quarter
May 17, 2017

Vinati Organics has announced the fourth quarter results financial year 2016-2017 (4QFY17). While the topline increased by 26.3% YoY, the bottomline increased by 3.3% YoY.

Performance summary
  • The company reported a strong growth in revenues. Net sales increased by 26.3% YoY. This is on the back of higher contribution from TB Amine and healthy growth in ATBS volumes.
  • Operating profits increased by 19.3% YoY. Operating margins stood at 31.1%. Operating margins declined by 1.8% due to higher raw material cost and other expenses.
  • Other income increased by 188.7% YoY. Depreciation increased 13.5% YoY.
  • Net profit increased marginally by 3.3% and net profit margin stood at 20.8%. This is primarily due to a higher tax rate (33.4% in 4QFY17 vs 16.1% in 4QFY16). The tax rate was lower in 4QFY16 due to deferred tax and earlier year's adjustment.

    Financial snapshot
    (Rs m) 4QFY16 4QFY17 Change FY16 FY17 Change
    Net sales 1,544 1,950 26.3% 6,309 6,663 5.6%
    Expenditure 1,037 1,344 29.7% 4,242 4,471 5.4%
    Operating profit (EBDITA) 507 605 19.3% 2068 2192 6.0%
    Operating profit margin (%) 32.9% 31.1%   32.8% 32.9%  
    Other income 20 58 188.7% 62 96 55.3%
    Interest 12 0 -96.9% 79 28 -65.0%
    Depreciation 47 53 13.5% 185 214 15.4%
    Profit before tax 468 609 30.1% 1866 2046 9.7%
    Tax 76 203 169.0% 550 653 18.8%
    Effective tax rate 16.1% 33.4%   29.5% 31.9%  
    Profit after tax/(loss) 393 406 3.3% 1,316 1,393 5.9%
    Net profit margin (%) 25.4% 20.8%   20.9% 20.9%  
    No. of shares (m)         52  
    Fully diluted EPS (Rs)*         27.0  
    P/E (x)*         32.4  
    *Based on trailing 12-months earnings
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