InvestorQ : How did you find the quarterly numbers of Motherson Sumi for the Dec-20 quarter?
Rutuja Nigam made post

How did you find the quarterly numbers of Motherson Sumi for the Dec-20 quarter?

1 year ago

India’s largest auto ancillary manufacturer, Motherson Sumi, reported 3-fold growth in Q32 PAT at Rs.798 crore. This profit boost was supported by higher top line revenues and lower finance charges. In terms of revenues, Motherson Sumi reported 13.95% growth for the Dec-20 quarter at Rs.17,092 crore on a consolidated basis.

For the Dec-20 quarter, Motherson Sumi benefited from the global recovery and showed good sales growth traction across product lines like auto parts for vehicles, rear view mirrors and drive assistance systems, plastic parts and system modules for cars. In addition, the overseas business of Motherson into design and manufacture of electrical distribution systems for commercial vehicles also did quite well.

Operating profits for the Dec-20 third quarter was up 142% at Rs.1,060 crore. This was triggered by higher sales revenues and the lower than expected rise in costs. This resulted in better absorption of fixed costs of the company due to economies of scale. As a result, OPM or the operating margins improved sharply from 2.92% in the Dec-19 quarter to 6.20% in the Dec-20 quarter.

Profit after tax (PAT) for the Dec-20 quarter was up 195% or nearly tripled at Rs.798 crore. Apart from economies of scale playing a part in better fixed cost absorption, the company also benefited from lower finance costs due to cheaper interest rates as well as deferred tax credit in the Dec-20 quarter. As a result, the PAT margins improved sharply from 1.80% in the Dec-19 quarter to 4.67% in the Dec-20 quarter.