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.
MICO: Profits plummet - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • Oct 29, 2001

    MICO: Profits plummet

    The slowdown in the economy and sluggish auto volumes have had a significant impact on the third quarter results of Motor Industries Company (MICO). While sales have dropped by 11% for 3QFY02, profits have plummeted by 41% on account of a sharp fall in operating margins.

    (Rs m) 3QFY01 3QFY02 Change 9mFY01 9mFY02 Change
    Sales 4,163 3,704 -11.0% 12,225 11,704 -4.3%
    Other Income 64 77 21.1% 260 242 -7.1%
    Expenditure 3,470 3,277 -5.6% 10,258 10,167 -0.9%
    Operating Profit (EBDIT) 694 428 -38.3% 1,967 1,536 -21.9%
    Operating Profit Margin (%) 16.7% 11.5%   16.1% 13.1%  
    Interest 45 (26)   59 (18)  
    Depreciation 341 332 -2.7% 1,149 981 -14.6%
    Profit before Tax 371 199 -46.4% 1,020 815 -20.1%
    Extraordinary item (6) 5   285 82  
    Tax 120 60 -50.3% 473 277 -41.4%
    Profit after Tax/(Loss) 245 144 -41.1% 832 620 -25.5%
    Net profit margin (%) 5.9% 3.9%   6.8% 5.3%  
    No. of Shares (eoy) (m) 3.6 3.4   3.6 3.6  
    Diluted number of shares 3.4 3.4   3.4 3.4  
    Earnings per share (Rs)* 287.9 169.6   325.8 242.8  

    Operating margins in 3QFY02 has come down to 11.5% in 3QFY02 from 16.7% in the corresponding quarter of the previous year. While raw material and staff costs have fallen by 19.9% and 1.1% respectively during the aforesaid quarter, higher other expenses (up 16.7%) suppressed margins. The voluntary retirement programme initiated by the company has resulted in cutting workforce by 500 employees.

    The company is dependant on the commercial vehicles market mainly due to its strong presence in the diesel fuel injection pumps market. Given the fact that the CV volumes have remained sluggish for the first half of the current financial year, volume growth has come under pressure. However, MICO had set up a plant in Jaipur to manufacture petrol fuel injection pumps sets last year to cater to the growing passenger car market. Though this has strengthened its position in the fuel injection as well as the OEM segment, the continued weakness in auto volumes remains a cause for concern. The slow down in the OEM segment also has affected performance of the company in the after-market segment for the manufactured goods.

    The scrip is currently trading at Rs 1,695 on a P/E multiple of 6.9x the annualised nine months earnings.



    Equitymaster requests your view! Post a comment on "MICO: Profits plummet ". Click here!


    More Views on News

    Atul Auto: Demonetization Impacts Volumes and Profitability (Quarterly Results Update - Detailed)

    Mar 1, 2017

    Atul Auto has reported a 11.2% YoY decline in the topline while the bottomline has declined by 23% YoY.

    Endurance Technologies Ltd (IPO)

    Oct 4, 2016

    Equitymaster analyses Initial Public Offering (IPO) of Endurance Technologies Limited

    GNA Axles Limited (IPO)

    Sep 14, 2016

    Should you subscribe to GNA Axle IPO?

    Precision Camshafts (IPO)

    Jan 27, 2016

    Precision Camshafts Ltd (PCL) is one of the world's leading manufacturer and supplier of camshafts, a critical engine component, in the passenger vehicle segment.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    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.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    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.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    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


    Aug 18, 2017 (Close)


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


    Compare Company With Charts