Ingersoll: 2QFY01 is a dampner - Views on News from Equitymaster

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Ingersoll: 2QFY01 is a dampner

Oct 25, 2000

Ingersoll Rand has recorded a 28% decline in its bottomline in 2QFY01. This is on the back of a marginal 1% decline in its turnover during same period. Even a 65% surge in other income and a whopping 92% decline in tax provisions could not save its bottomline from taking this hit.

(Rs m) 2QFY00 2QFY01 Change 1HFY00 1HFY01 Change
Sales 769 759 -1.2% 1,914 1,439 -24.8%
Other Income 35 57 65.3% 67 103 54.9%
Expenditure 637 713 12.0% 1,569 1,315 -16.1%
Operating Profit (EBDIT) 132 47 -64.8% 345 123 -64.2%
Operating Profit Margin (%) 17.2% 6.1%   18.0% 8.6%  
Interest 0 0 - 1 0 -
Depreciation 16 16 -3.0% 34 31 -8.5%
Profit before Tax 150 88 -41.5% 377 196 -48.1%
Other Adjustments 0 5   0 390 -
Tax 39 3 -92.3% 120 134 11.4%
Profit after Tax/(Loss) 111 80 -27.7% 256 451 75.9%
Net profit margin (%) 14.4% 10.6%   13.4% 31.4%  
No. of Shares (eoy) (m) 31.6 31.6   31.6 31.6  
Earnings per share* 14.1 10.2   16.2 28.6  
*(annualised)            
Current P/e ratio   13.8        

A 12% jump in expenditure did most of the damage to the company's bottomline.

Ingersoll sold off its gas compressor business in 1QFY01, resulting in an extraordinary profit of Rs 441 m. It also paid off Rs 51 m as VRS expenses to trim its workforce. All this resulted in a 76% jump in its first half (1HFY01) bottomline to Rs 451 m. But in real terms (i.e. including only operational profits and expenses) its net profit actually declined by 49% to Rs 62 m when compared to 1HFY00.

The company's stock trades at Rs 140 at a P/e multiple of 13.8 times its annualised FY01 earnings. This price its near its 52 week low. Well, in light of its performance, this is not surprising.


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For the quarter ended September 2019, INGERSOLL RAND has posted a net profit of Rs 227 m (up 1.2% YoY). Sales on the other hand came in at Rs 2 bn (down 3.4% YoY). Read on for a complete analysis of INGERSOLL RAND's quarterly results.

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