Better margins and stronger growth helped Varroc Engineering report improved operational results in Q2 FY23.
The auto components group recorded a 21.2 per cent growth in consolidated revenue in the quarter at ₹1,834.1 crore on a YoY basis. Consolidated EBITDA margins improved by 100 bps at 9.2 per cent.
Operational PBT before JV profit/(loss) came in at ₹54.5 crore, up 95 per cent YoY and 294 per cent QoQ.
Tarang Jain, CMD, said in a statement, “Automobile production for all the segments in Q2 FY23 grew on YoY basis as well as on QoQ basis. The main reasons are the lower base of last year and early festive season. On a YoY basis, two-wheeler production grew by 7.7 per cent, three-wheelers by 24.3 per cent, passenger vehicles by 38.1 per cent and commercial vehicles by 36.2 per cent”.
He added, “ Revenue grew by 21.2 per cent to a record Rs 1,839.9 crore on a YoY basis. This is the highest revenue generated by our entities in any quarter. Profitability improved on a sequential basis with an improvement in the EBITDA margin by 100 basis points. This is the second consecutive quarter when the EBITDA margin has expanded, and it came in at 9.2 per cent”
The operational PBT before JV profit also improved sequentially by more than 294 per cent at Rs 54.5 crore. The reported PBT of Rs 30.7 crore was impacted negatively by the net mark-to-market forex impact of Rs 24.2 crore mainly on intercompany loans.
“We continue to have strong order wins for new business in H1 FY23 across business units, enabling our future growth. During H1 FY23, lifetime revenue from new order wins stood at Rs 2,547.6 crore. Of this, business wins from five prominent EV customers was Rs 867.6 crore,” said Jain.