Companies

Eveready net profit dips to Rs 13.8 cr

Jayanta Mallick Kolkata | Updated on January 22, 2018 Published on November 13, 2015

Amritanshu Khaitan, MD, Eveready Industries India   -  Business Line

Eveready Industries India Ltd has reported dip in net profit at ₹13.81 crore in the second quarter to September 30, 2015, against ₹17.64 crore in the corresponding period last fiscal.

The company said this was because total expenses had gone up to ₹343.05 crore (₹324.89 crore).

Though the finance cost during the year remained largely unchanged, the increased spend on advertising and promotion (6.2 per cent of the net sales) for LED lighting products was one of the main reason for lower profit.

The company said, “spends will normalise to around five per cent of the net sales for the whole year, thus, the following two quarters will see significantly lower spends”.

The leading dry cell battery producer also said that there was a mark-to-market loss of ₹3.9 crore on hedging zinc import prices in dollar terms during the quarter. The loss was due to fall in zinc prices. “The fall in key raw material prices was good news and the M-T-M loss may get neutralised over the coming months,” said Amritanshu Khaitan, MD of the company.

The impact of fall of rupee value against dollar had been quite substantial during the quarter. However, the company managed to smother the negative impact by price rise. It said another price increase in certain select batteries accounting for nearly 40 per cent of battery sale value has been planned in the third quarter.

An erratic monsoon caused 12 per cent drop in flashlight sales and the battery segment saw flat growth owing to “dumping” of poor quality products from China and Vietnam, the company said.

The regulatory counter measure by the Director General of Antidumping & Allied Duties in initiating investigation on imports of dominant dry cell battery category (AA – accounting for 70 per cent of market) could bring in positive impact on sales in future, the company expected.

The ₹5-Eveready stock closed at ₹271.50 on the BSE, down two per cent.

Published on November 13, 2015
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