• OUTLOOK ARENA
  • VIEWS ON NEWS
  • JULY 31, 2001

Goodlass: A mixed performance

Goodlass Nerolac, the paint major, has reported a 6% drop in sales to Rs 1,243 m for the first quarter ended 30th June 2001. The slow down in the economy and continued sluggishness in both the commercial vehicles and passenger car sales seems to have affected topline growth in the first quarter.

(Rs m) 1QFY01 1QFY02 Change
Sales 1,323 1,243 -6.0%
Other Income 18 32 76.2%
Expenditure 1,213 1,144 -5.7%
Operating Profit (EBDIT) 109 99 -9.6%
Operating Profit Margin (%) 8.3% 8.0%  
Interest 18 11 -38.9%
Depreciation 35 55 57.1%
Profit before Tax 75 65 -13.0%
Tax 22 20  
Profit after Tax/(Loss) 52 45 -13.1%
Net profit margin (%) 3.9% 3.6%  
No. of Shares (eoy) (m) 15.3 15.3  
Diluted number of shares 15.3 15.3  
Earnings per share (Rs) 13.6 11.8  

Other income is up sharply by 76.2% probably on account of higher lease rentals from the colour tinting machines, which the company has been aggressively expanding over the last two years. Though operating expenses have come down by 5.7%, it has failed to stem a fall in operating profit. However, raw material costs as a percentage of sales have come down from 71.2% in 1QFY01 to 60.6% in 1QFY02.

A sharp fall in interest outflow in 1QFY02 has prevented the bottomline from a huge drop. Net profit has fallen by 13.1% to Rs 45 m.

The scrip is currently trading at Rs 76 at a P/E multiple of 6.4x the annualised 1QFY02 earnings. With automobile demand expected to pick up in the second half coupled with a good monsoon, paint demand could potentially show progress towards the end of the year.

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 (Research Analyst) bearing Registration No. INH000000537 (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, Canada or the European Union countries, 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 (Research Analyst)
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