Finolex Industries net zooms by 121 percent

Mumbai: Finolex Industries Ltd [FIL] has once again delivered an impressive performance for the quarter ended 31st December 2003. Net Profit for the period has more than doubled to Rs 28.4 crore as compared to Rs.12.86 crore in the quarter ended December 2002, which is an increase of 121 percent. The turnover during the quarter increased by 18 percent to Rs 266.64 crore as compared to Rs 226.28 crore in the quarter ended December 2002.

Earnings per Share (EPS) for the quarter ended 31st December 2003 is Rs.2.29 (against Re.1.00 for the corresponding quarter of earlier year) & Cash Earnings per Share (CEPS) is Rs.3.16 (against Rs.1.82 for the corresponding quarter of earlier year)

The net profit for the quarter has been healthy on account of better sales realisation with substantial increase in margins. While the prices of raw material in international markets remained subdued, the prices of PVC in international markets firmed up during the quarter ended 31st December 2003.

The domestic demand for PVC has already outstripped supply. In fact, data available clearly shows that PVC demand in India is estimated to have grown by almost 20 percent during the first half of FY 2004. The market is expected to grow at 8 percent to 10 percent p.a. over the next few years. The PVC Division of FIL has been doing exceptionally well and enthused by the performance, the management of FIL has decided to increase the PVC capacity by an additional 130,000 MT p.a. As the International prices of PVC are expected to remain healthy in the near future, the expectations of a strong year ahead for PVC cannot be ruled out.

The PVC Pipes division is also witnessing strong demand growth on the back of a good monsoon. Various large schemes including Andhra Pradesh Micro Irrigation Project (APMIP) have been launched recently, which will give a further boost to the PVC Pipes demand. Further, the Union Government has recently announced several incentives for the agricultural sector. As FIL''s focus is mainly on the rural markets, this is expected to result in strong growth in PVC Pipe sales. FIL had increased the PVC Pipes capacity from 52,000 Mts p.a. to 59,000 Mts p.a. during last quarter. FIL plans to increase the capacity further to 65,000 Mts p.a. during the next quarter.

The company has already disbursed an interim dividend @ Re. 1 per share for the current year.

It may be noted that Finolex Industries Limited [FIL] is the largest manufacturer of PVC pipes and third largest manufacturer of PVC Resin in India. FIL has received the ISO/14001 certification for Environmental Management System for PVC and PVC pipes plants at Ratnagiri. The Company has also been accredited with the new ISO Certification [IS/ISO 9001:2000] for PVC pipes plant at Pune and Ratnagiri. The PVC plant at Ratnagiri has recently received "Prashansa patra" from National Safety Council of India for its "very good safety record". FIL has received the National Safety Award for 3 years in succession.