Shares of Castrol India surged over 7 per cent on the BSE in Tuesday's intra-day session following an impressive set of March quarter numbers. The leading lubes player on Monday reported a near doubling of net income for the quarter to March at Rs 243.6 crore as against Rs 125.2 crore a year ago, driven by robust revenue growth.
Revenue grew to Rs 1,138.7 crore in the reporting quarter from Rs 688 crore a year ago. Its revenue for the full year ended December 2020 was Rs 2,996.9 crore when it had a net income of Rs 582.9 crore.
Castrol India's Managing Director Sandeep Sangwan attributed the good set of numbers to the focused investments, interventions and actions taken in the second half of 2020.
These included brand building with increased marketing and advertising spends, new product introductions as well as corrective pricing.
Following the March quarter results, the stock hit an intra-day high of Rs 134.15 on the BSE. Around 11.18 am, it was trading 2.95 per cent higher at Rs 128.95 as against a rise of 0.66 per cent in the S&P BSE Sensex. The stock had hit a 52-week high of Rs 140.35 on March 3, 2021.
The second wave of the pandemic is resulting in a slowdown in various parts of the country. In addition, supply disruptions on account of base oil and raw materials availability, logistics challenges and rupee depreciation are likely to adversely impact demand and supply going forward, the company said.
Analysts at Motilal Oswal Financial Services have a BUY rating on Catrol India. The brokerage said Castrol delivered a beat across all fronts during its Q1 performance. The company follows January-December financial year.
"The company generated net cash of Rs 2.7 billion during 1QCY21, resulting in a cash generation of 112.5 per cent of PAT, due to robust working capital management, along with cost management initiatives," it added.
Dear Reader,
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.
Digital Editor
RECOMMENDED FOR YOU