Riding on the back of a generous dividend payout announcement by Swaraj Engines Ltd (SEL), the shares of the company spurted by 8.05 per cent in the NSE at close today.

In fact, the company’s share price, which touched a 52-week low of Rs 380 on April 12, has rallied by Rs 65 since then, half of which came today.

However, the company, which is a major supplier of tractor engines to M&M and in which M&M holds a 33.2 per cent stake, registered a marginal fall in income and net profit in Q4 of last year, compared to the corresponding quarter in the earlier year (2011-12).

In an announcement to the stock exchanges, the company said its board of directors has recommended a dividend of 130 per cent (Rs 13 per share) for the financial year ended March 31, 2013. In addition to the regular dividend, SEL said “following its investor-friendly approach and keeping in view the company’s surplus cash position”,  the board has recommended a special dividend payment of 200 per cent (Rs 20 per share), taking the total dividend to 330 per cent (Rs 33 per share) for FY 2012-13.

The company, during the fourth quarter of last year, sold 13,686 engine units as against 14,274 units in the same period in the earlier year, which it attributed to the “subdued tractor industry scenario”. Its total operating revenue in Q4 of 2012-13 was Rs 114.54 crore (Rs 118.39 crore). The net profit was Rs 13.94 crore (Rs 13.42 crore).

For the full year last year, operational income was Rs 479.03 crore (Rs 448.48 crore), an increase of 7 per cent, and the net profit was Rs 55.40 crore (Rs 52.82 crore). The EPS (share face value of Rs 10) was up marginally at Rs 44.61 from Rs 42.53 in 2011-12.

Apart from supplying engines to Swaraj division of Mahindra & Mahindra Ltd, the company also supplies hi-tech engine components to SML Isuzu Ltd.

The stock closed strongly at Rs 445, a gain of Rs 33.15 or 8.05 per cent today in the NSE.

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