Depreciation and input costs have dragged down the fourth quarter net profit of MM Forgings.
Profits dropped 75 per cent to Rs 1.46 crore from the corresponding quarter last year. For the 2011-12 financial year, net profit slid 3.5 per cent to Rs 19.5 crore.
Total income in Q4 grew 21 per cent to Rs 93.4 crore. For the full year, income touched Rs 350 crore, a 28 per cent growth over the previous year. Export markets and new products have contributed largely to the income growth.
“We cannot do much about raw material price but pass it on. Power and fuel cost rise is also here to stay, though we are looking at optimising our resources,” said Mr Vidyashankar Krishnan, Managing Director.
With power being a challenge in Tamil Nadu, MM Forgings is looking to improve connectivity through dedicated lines between sub-stations to its plants.
MM Forgings has invested Rs 25 crore to expand power generation at its wind farm in Tirunelveli. The wind farm will supply around 50 per cent of the company's needs this year.