Sales for the quarter were up by 22% at Rs. 869 Cr. as against Rs.713 Cr. for the same period last year. The profit before depreciation, interest and tax for the quarter was at Rs. 104 Cr. against Rs. 88 Cr. last year, a growth of 18%. The profit before tax and exceptional items for the quarter improved by 22% and was higher at Rs. 70 Cr. against Rs. 58 Cr, in the previous year.
Mr. L. Ramkumar, Managing Director said, “While the Engineering and Metal Formed businesses reported a revenue growth of over 30%, the growth in the bicycles business was at 4%”. The low growth in bicycles, he said, was due to slow down in demand in the initial months of the quarter. He added that higher productivity, efficient use of capacities and good volumes in the Engineering and Metal Formed businesses helped to improve its operating profit during the quarter. He also said that due to lower demand and competitive pressure the margins on bicycles were under pressure.
Review of Businesses – First Quarter
The bicycles volume for the quarter was in line with that of the corresponding period of last year. Demand fell sharply in April and May but it has picked up since then. Forty retail outlets under the various formats have been added during the quarter. Retailing of bicycles and fitness products continue to provide customers a good buying experience and service that are contemporary and 25% of the bicycle segment revenue is derived through this channel. The division grew significantly in the premium segment. With its continued thrust in the Rural Retail format it opened 30 stores during the quarter taking the tally to 100, as of today.
With respect to Electric Scooters the focus was on improving the performance of key components such as batteries with a view to enhancing distance per charge and reducing charging time. Though sale of electric scooters was lower during the quarter as compared to the corresponding quarter of the previous year, consumer interest for these products is increasing and the subsidies announced by the Government are making them attractive. It is expected that the performance will be better going forward. During this quarter this division recorded revenue of Rs 318 Cr, a growth of 4% over the corresponding period of last year.
Auto industry grew at a lower rate of 15% during the quarter as compared to the corresponding quarter of the previous year. Precision Tubes (electrical resistance welded and cold drawn welded) grew by 24% in volume terms on the back of higher share with key customers. The Tubular components segment continues to perform well and recorded a growth of 37% during the current quarter.
During this quarter this division recorded revenue of Rs 360 Cr, a growth of 32% over the corresponding period of last year.
Metal Formed Products
In this segment, volumes of automotive chains increased by 24% and that of industrial chains by 12%. Fine blanked components registered a 79% growth with the success of all new product programmes undertaken during the last year. Export of industrial chains grew by 33%. The products for the railway segment grew significantly registering a 137% growth in volumes. The doorframe segment volumes were flat on the back of a low 9% growth in passenger vehicle sales.
During this quarter this division recorded revenue of Rs 233 Cr, a growth of 39% over the corresponding period of last year.
The Company consolidated profit before tax and exceptional items for the quarter was at Rs. 105 Cr. against Rs.79 Cr. in the previous year, a growth of 25%.
Financiere C 10, the Company’s overseas subsidiary manufacturing Industrial chains grew by 30% over the same period last year and achieved a turnover of Rs.53 Cr. and a Profit before Tax of Rs. 1 Cr. during the quarter. Cholamandalam Investment & Finance Company Ltd, a subsidiary company in the financial service business achieved a profit before tax of Rs.57 Cr. against a profit of Rs.23 Cr. in the previous year. Cholamandalam MS General Insurance Company Ltd. a general insurance subsidiary of the Company registered a significant growth of 31% in Gross Written Premium during the quarter and achieved a Profit before Tax of Rs. 6.7 Cr, a growth of 35% over the corresponding period.
About Tube Investments of India
Tube Investments of India consists of TI Cycles of India, Tube Products of India, TI Metal Forming (including Chains). In bicycles, TII is the second largest manufacturer with well-known brands – Hercules, BSA and Philips. TII is the market leader in precision steel tubes and roll-formed car doorframes in India. Also, being the second largest motor cycle chain manufacturer in India, TII is a major supplier to the Indian auto / auto- component industry. In the recent times, the Company has introduced E- Scooters.
About the Murugappa Group
Founded in 1900, the Rs. 17051 Crores (USD 3.8 billion) Murugappa Group is one of India’s leading business conglomerates. The Group has 29 businesses including eight listed Companies actively traded in NSE & BSE. Headquartered in Chennai, the major Companies of the Group include Carborundum Universal Ltd., Cholamandalam Investment and Finance Company Ltd., Cholamandalam MS General Insurance Company Ltd., Coromandel International Ltd., Coromandel Engineering Company Ltd., E.I.D. Parry (India) Ltd., Parry Agro Industries Ltd., Tube Investments of India Ltd., and Wendt (India) Ltd.
Market leaders in served segments including Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Construction, Bio-products and Nutraceuticals, the Group has forged strong joint venture alliances with leading international companies like Groupe Chimique Tunisien, Foskor, Cargill, Mitsui Sumitomo and Morgan Crucible. The Group has a wide geographical presence spanning 13 states in India and 5 continents. Renowned brands like BSA, Hercules, Ballmaster, Ajax, Parry’s, Gromor and Paramfos are from the Murugappa stable. The organization fosters an environment of professionalism and has a workforce of over 32,000 employees.
For any clarifications, please contact:
Managing Director, Tube Investments of India Ltd.
Ph : 044 – 4228 6702 / 4211 4747
For further information, please contact:
Vinod Kumar / Diya Kinger
Ogilvy Public Relations Worldwide
Mobile: 98401 26179 / 8939623044