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Moneycontrol India :: News :: International orderbook now at Rs 3800 cr: Voltas :: Voltas :: Results Boardroom :: Voltas ,MM Miyajiwala

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International orderbook now at Rs 3800 cr: Voltas

2008-05-20 10:51:55 Source : Bazaar/CNBC-TV18
(Interview Transcript)

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Voltas has announced its FY08 results. The company has reported consolidated net profit of Rs 207.68 crore as against Rs 201.58 crore in FY07 and net sales of Rs 3,202.93 crore versus Rs 2,526.74 crore (YoY). Its net sales for Q4 were at Rs 589.12 crore versus Rs 539.97 crore. Its Q4 other income was at Rs 5.92 crore versus Rs 12.92 crore.

The company's Q4 operating profit stood at Rs 4.97 crore versus Rs 76.78 crore. Its Q4 net profit was at Rs 14.02 crore versus Rs 36.91 crore.

MM Miyajiwala, Executive Vice President & Chief Financial Officer of Voltas said that his company�s OPMs (operating margins) have grown by 100% after excluding extraordinary items. Their company has seen an extraordinary income of Rs 68 crore last year, he informed CNBC-TV18.

Miyajiwala said, "Our orderbook looks very healthy, our domestic orderbook has risen by 37% to Rs 800 crore and our international orderbook now stands at Rs 3,800 crore, which is even higher than our annual turnover of Rs 3,088 crore that we have achieved in the year 2007-08."

Excerpts from CNBC-TV18�s exclusive interview with MM Miyajiwala:

Q: I was asking you to line out in specific what�s happened this time around on the bottomline and what exactly the operating profit margin performance has been for Voltas?

A: If you look at our quarterly results and annual result, I would like to say that we have done extremely well particularly on operating profit levels. Last year, we had two one-time items, we had an exceptional income of about Rs 68 crore coming from sale of investment in one of our subsidiaries companies and another one of our subsidiary companies was also holding shares in this company.

So whatever profits we got out of that, they declared a very substantial dividend to Voltas of about Rs 12 crore; if you exclude that, we received a very significant interest refund - we received from the Income Tax department of about Rs 16 crore and we took the profits before exceptional items, then there is a growth of 100% over last year, which is very significant.

Our turnover has also risen by about 30% and the most significant thing is that our orderbook looks very healthy, our domestic orderbook has risen by 37% to Rs 800 crore and our international orderbook now stands at Rs 3,800 crore, which is even higher than our annual turnover of Rs 3,088 crore that we have achieved in the year 2007-08.

So it portrays very well for the future to come and we are very happy and bullish about our future and that is also indicated by the increase in the dividend in the current year.

Q: What has happened with the margins because of the rise in the input cost and can you just break up that orderbook picture between the cooling side and the engineering products?

A: As far as the cooling side is concerned, there is no orderbook because this is primarily stock in sale. The entire orderbook that I�m taking about is an electromechanical project both in India and international - so that adds upto Rs 4,600 crore as against about Rs 1,600 crore of turnover that we have for the year in that segment.

Q: The other part of my question was on the margin performance this time, where the raw material costs have put a little bit of pressure on it?

A: As far as raw material prices are concerned, those are matters of concern but we are not too worried about it. One is because in all the future projects that we have bagged and which we are working on, we have taken adequate margin for the future increases in prices of these metals, as well as increase in wages which are likely to happen in the future. The second thing is that in most of our projects; particularly the international project, we try to pass on the price increases to our suppliers by having back to back firm contracts with them. Therefore we don�t think that we are likely to be impacted in the 'A' class or 'B' class metal price increases.

Q: From FY09 perspective, what is that you are looking out for in terms of the topline and the bottomline growth and also in terms of your orderbook, where do you see the maximum contribution coming in from which of your segment?

A: As far as orderbook is concerned I�ll take your second question first. The orderbook is primarily important in the first segment and there we see the pipeline to be very strong and therefore we see that more orders would be coming up in the quarters to come.

As far as �08-�09 growth is concerned, we don�t go for forward looking statements. However I would only say that if you look at our orderbook, that should give you enough comfort for the future.

Q: Any international projects that you will be particularly looking at and what kind of growth you see from that market?

A: We are looking at several projects internationally and even geographical expansions and I hope that at the end of the first quarter, I will be able to talk more specifically about that.