The slump in the commercial vehicle and construction/mining sectors has impacted the fortunes of Wheels India. For the fourth quarter, the company posted a 24 per cent dip in net profit (year on year) at Rs 5.35 crore (Rs 7.05 crore).

Sales fell 19 per cent to Rs 469 crore (Rs 578 crore). During the 2012-13 financial year, Wheels India’s revenues was down 7.35 per cent at Rs 1,927 crore (Rs 2,080 crore). Net profit dipped 7.2 per cent to Rs 31.88 crore (Rs 34.35 crore).

The company has recommended a dividend of Rs 8.10 per share for 2012-13. Srivats Ram, Managing Director, said the second half of the year especially was a “dampener”.

While passenger cars and utility vehicles had some growth, tractors and trucks were a big let-down. “We expect the current year to see muted growth.”

The Jawaharlal Nehru National Urban Renewal Mission for modernisation of buses could bring some relief, in the form of orders for air suspensions. The company is also hoping for business from the proposed mega power projects (Wheels India makes fabrications for thermal plants).

Diversifying

“We are not banking on the auto sector this year,” said Ram.

Wheels India has tied up with a Turkish company Ege Endustri to obtain technology to make lift axles.

The company expects to roll out the products by next year to serve the domestic truck industry. In a recent open offer, foreign promoter Titan Europe acquired 5.74 lakh shares of Wheels India.

Titan now holds 41.73 per cent, while Indian promoters have 49.7 per cent.

Wheels India has obtained shareholders’ nod to raise equity capital of Rs 100 crore.

This will help the company meet the SEBI mandate for listed companies to have a minimum public shareholding of 25 per cent.

swetha.kannan@thehindu.co.in

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