The Telegraph
Since 1st March, 1999
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Result Analysis

Dr Reddy’s Laboratories

Dr Reddy’s has had a bad year indeed. Its last fiscal numbers have been pretty disappointing. At Rs 1,513.61 crore (Rs 1,521.13 crore), income from operations was down half a per cent from the corresponding previous period. At Rs 1,084.86 crore (Rs 1,041.30 crore), operational cost was up 4 per cent. Declining sales and increasing costs have hurt its margins. At Rs 428.75 crore (Rs 479.83 crore) the operating profit was down 11 per cent over the same period previous year. Other income at Rs 66.69 crore (Rs 51.53 crore) was up 29 per cent. With a huge 251 per cent increase in tax provision at Rs.39.07 crore (Rs 11.12 crore), net profit slumped by 15 per cent to Rs 392.09 crore (Rs 459.65 crore). The stock, which had been on a continuous downslide, has seen some support since May-end and currently trades at Rs 1,135 discounting its full year EPS of Rs 51.24 by 22 times. Unless DRL unveils new initiatives in exports and R&D, the stock will stagnate.

Mid-day Multimedia

Print and electronic media player Mid-day Multimedia has put up a very poor performance for the first quarter ended June 2003. Net income from operations was down 2 per cent at Rs 20.45 crore compared with Rs 20.77 crore in the corresponding previous quarter. Operational spending remained almost the same as last year at Rs 18.12 crore (Rs 18.10 crore). Poor revenue generation and no significant change in costs have seen margins take a hit during the quarter. Operating profit was down 13 per cent at Rs 2.33 crore (Rs 2.67 crore). Other income at Rs 0.55 crore (Rs 0.49 crore) was up 12 per cent. It was further complemented by a 14 per cent decline in the interest cost, which stood at Rs 0.18 crore (Rs 0.21 crore). Depreciation was up 9 per cent at Rs 0.75 crore (Rs 0.69 crore). Lower taxable profits have brought down the tax provisioning by 20 per cent to Rs 0.60 crore (Rs 0.75 crore) resulting in 11 per cent decline in net profit which stood at Rs 1.35 crore (Rs 1.51 crore). The stock has seen a good rise from its low levels in the recent rally of the market and currently trading at Rs 19.40 discounts its June quarter annualised EPS of Rs 1.59 by 12 times.

Aztec Software

Though it seems that there is a slight improvement in Aztec Software’s in the first quarter of this fiscal as compared with the corresponding previous quarter, the firm has not really performed well. Income from operations at Rs 8.48 crore (Rs 11.23 crore) was down 24 per cent from the year-ago period. However, it has brought down costs resulting in a 43 per cent saving in operational spending at Rs 8.60 crore (Rs 15.03 crore). This has helped the firm keep its operational loss at a lower level of Rs 0.12 crore compared with Rs 3.80 crore loss last year. Aztec's saving grace has been a huge rise in the other income, which stood at Rs 1.21 crore (Rs 0.20 crore). Further consolidation came by way of reducing debt to zero, which saw no additional cost on account of interest. Depreciation too was down 23 per cent at Rs 0.57 crore (Rs 0.74 crore). Having brought down almost every component of cost it reported a before tax profit of Rs 0.52 crore (Rs 4.36 crore) and having written back tax provision to the tune of Rs 0.06 crore as against a provision of Rs 0.05 crore in the year-ago period, the firm reported a net profit of Rs 0.58 crore (Rs 4.41 crore). The stock has been moving up due to improvement in performance and currently trading at Rs 24.45 discounts its June quarter annualised EPS of Rs 1.91 by 13 times.

Blue Dart Express

Logistics major Blue Dart Express Limited has performed reasonably well during the first quarter of this financial year with net sales moving up by 5 per cent to Rs 82.10 crore (Rs 77.91 crore). The margins improved slightly as operational cost also went up by 5 per cent to Rs 70.58 crore (Rs 67.45 crore). Operating profit was up by 10 per cent over the corresponding previous quarter at Rs 11.52 crore (Rs 10.46 crore) while the OPM inched up to 14 per cent from 13 per cent last year. Other income was negligible while interest cost came down to 52 per cent at Rs 0.94 crore (Rs 1.95 crore). Depreciation at Rs 2 crore (Rs 1.60 crore) was up 25 per cent compared with the year-ago period. A 24 per cent rise in profit before tax saw the tax provision move up by 26 per cent to Rs 3.11 crore (Rs 2.47 crore). The company reported a net profit of Rs 5.55 crore (Rs 4.51 crore), up 23 per cent from the year-ago period. The stock has seen a smart rise since early April and currently trading at Rs 87.50 discounts its June quarter annualised EPS of Rs 9.36 by nine times.

Company        Total Income       Net profit        Equity       O. Income       EPS*

Dr Reddy’s**       1513.61       392.09       38.26       66.69       51.24 Mid-Day Multimedia       20.45       1.35       34.05       0.55       1.59 Aztec Software       8.48       0.53       12.12       1.21       1.91 Blue Dart Express       82.10       5.55       23.73       0.08       9.36 n Figures in Rs crore; * annualised; ** full year review

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