The Hindu Business Line : Shanthi Gears sales jump but net remains flat

Coimbatore May 16 Despite registering a growth in net sales in the fourth quarter of 2006-07, the net profit of Coimbatore-based industrial gear manufacturer Shanthi Gears Ltd has remained near stagnant because of higher staff and raw material cost and other expenditure compared to the same period during the previous year.

Net sales in the quarter ended March 2007 was higher at Rs 62.01 crore as against Rs 48.34 crore in the same period last year. The profit before tax was marginally higher at Rs 14.61 crore (Rs 14.54 crore).

After making provision for current and deferred tax and FBT, the net profit was marginally up at Rs 9.01 crore (Rs 8.98 crore). But the reversal of entry tax provision made in earlier years to the tune of Rs 2.27 crore resulted in net profit after extraordinary income moving up to Rs 11.28 crore (Rs 8.98 crore).

EPS (share face value Re 1) excluding extraordinary income was Rs 1.12 (Rs 1.14) and including extraordinary income it was Rs 1.40. The board has recommended a 100 per cent dividend.

For the full year 2006-07, the net sales were Rs 201.35 crore (Rs 162.28 crore) and the net profit after extraordinary income was Rs 35.85 crore (Rs 28.05 crore). The full-year EPS before extraordinary income was Rs 4.16 (Rs 3.56).

SGL shares closed on NSE up Rs 4.40 (6.24 per cent) at Rs 74.90 on Wednesday compared to the previous close of Rs 70.50. The volume of shares traded was 3.2 lakh.