Focus to be on high technology products: Sundram Fasteners
Suresh Krishna, CMD
Feb 04, 2016 | Source: CNBC-TV18
Sundram Fasteners reported stable earnings with third quarter net profit at Rs 41.7 cr as against Rs 30 cr in the same period a year ago. The company’s total income came in at Rs 614 cr in the quarter ended December 31 and operational efficiency (EBITDA) improved to Rs 94.7 cr.
Raw material prices have played a small part but the mix of the products that Sundram Fasteners have done, both in India as well as export, has contributed a lot more. The demand for more sophisticated engineering parts, highly engineered parts and high technology parts has increased quite a bit where the profit margins are definitely better. That has contributed quite a bit to the increase in profit margin.
The main focus was on improving the bottom-line than topline. In the third quarter, dips were seen in commercial vehicle and tractors segment whereas cars and two-wheelers saw improvement.
The export business has grown steadily in the last quarter. The diesel engine market in America has slowed down a little bit and Europe has not performed very well. Having said that, we have now entered into new lines of business as far as exports are concerned. A lot of the transmission parts have come into stream since two years and that is now going to pull up the numbers.
We are also introducing new products for exports, which should take effect from anywhere between 12 months and 18 months. On the ongoing basis, the export figure should look much better.