Finolex Inds skid after Q1 PAT drops 32% YoY to Rs 100 cr

Finolex Industries fell 4.86% to Rs 133.15 after the company's standalone net profit tumbled 31.8% to Rs 100.09 crore in Q1 FY23 as against Rs 146.80 crore recorded in Q1 FY22.

Total income from operations surged 23.2% to Rs 1,189.81 crore in a quarter ended 30 June 2022 from Rs 965.72 crore reported in same period last year.

Profit before tax stood at Rs 118.31 crore in Q1 FY23, down 40.9% from Rs 200.04 crore in Q1 FY22.

Total expenses spiked 40.46% to Rs 1,096.57 crore in Q1 FY23 over Q1 FY22. During the quarter, cost of raw materials and components consumed surged 49.9% to Rs 857.05 crore and employee benefits expense rose 12.34% to Rs 51.06 crore.

Finance costs soared 138.03% to Rs 11.33 crore in the Q1 FY23 as compared to the corresponding quarter last year.

EBITDA dropped by 39.9% to Rs 125.91 crore in Q1 FY23 from Rs 209.51 crore posted in Q1 FY22. EBITDA margin decreased to 10.58% in Q1 FY23 as against 21.70% reported in Q1 FY22.

On a standalone basis, volumes in Pipes & Fittings segment jumped 28.9% to 71,960 million tonnes (MT) in Q1 FY23 against 55,819 MT recorded in Q1 FY22. Volumes in PVC Resin (External) segment slumped 51.7% to 4,218 MT in Q1 FY23 against 8,726 MT recorded in Q1 FY22.

Commenting on the quarterly results, Prakash P. Chhabria, executive chairman, Finolex Industries said, The move towards normalization of PVC price after a 2-year long period of elevated PVC prices is positive for the industry. This should bolster demand, open the markets further and provide the required boost for markets to reach pre-covid levels. This is reflective in the strong volume growth during the quarter

Meanwhile, the company's board has approved the appointment of Ajit Venkataraman, as chief executive officer (CEO) and key managerial personnel (KMP) of the company with effect from 1 August 2022.

Finolex Industries is the third-largest player in the PVC resin market and one of the largest manufacturers of PVC pipes in India. The company has three manufacturing facilities, one each in Pune and Ratnagiri (both in Maharashtra) and Masar, near Vadodara in Gujarat.

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