The revenue for Q1FY22 stood at Rs. 1,803 crores, a growth of 91.2% YoY. The revenue increase by 2.9% on a QoQ basis.
Operating profit stood at Rs. 593 crores. The operating profit increased by 114.1% YoY and suffered a decline of (-3.1%).
The operating margins in Q1FY22 were 33%, an increase of 400 bps when compared to the operating profit margin of 29% during Q1FY21. The operating margins were down by (-200) bps on a QoQ basis.
The operating margins declined due to higher logistics costs.
Profit before tax stood at Rs. 484 crores, an increase by almost 181% when compared to the PBT of Q1FY21. PBT declined by (-3.8%) on a QoQ basis.
The company registered a PAT of Rs. 331 crores. The PAT suffered a decline of (-12.9%) when compared to Q4FY21 PAT of Rs. 380 crores. PAT has improved by 150.8% on a YoY basis.
Business Highlights
First interim dividend of Rs. 4/share for FY22. has been declared by the company.
Q1FY22 was supported by strong tailwinds in demand across its geographies and segments. The company registered its highest ever volumes too.
Volumes grew by 1% QoQ basis and 80% on YoY basis. The volumes in Q1FY22 stood at 68.6 kt. This was the highest ever quarterly sales volume by the company.
For FY22, the volume guidance by the management remains at 250kt-260kt. The COVID led uncertainty has caused management to be conservative on guidance of volumes.
The company has taken a 2%-3% price hike in July 21. The company aims to take quarterly price hikes and also keep operating margins at 28%-30% on long term basis.
The dealer inventory has come to normal levels at 35-40 days as compared to 20-25 days earlier.
The company has guided at Rs. 900-1000 crores CAPEX for FY22.
The company currently is operating at its peak capacities. The maximum production which can be done is at 285kt per year in its current capacity.
The company believes that the raw material costs have rose to its peak and could remain at these levels.
The company has a market share of 5.5% in global specialty tyre segment. Excluding China, the same would be 7.5%. The growth rate in the segment currently is ~3.5% on annualized basis.
Performance of Indian business was subdued to due lockdowns and seasonality factors. US sales have increased and now contribute 16.1% to total sales in Q1FY22 as management is focusing on the area.
Replacement channel continues to contribute to majority of the sales as it stands at 71.9% in Q1FY22.
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