VALUE PICK MARCH ’18: BALKRISHNA INDUSTRIES LIMITED, Update

Update

Q1 FY23 Earnings

 

Balkrishna Industries Limited – an Indian multinational tyre manufacturing company based in Mumbai, India has presented its Q1 FY2022-23 numbers today.

 

On a consolidated basis, revenue from operations of the company stood at INR 2619.43 crore for the Q1 ending 30 June 2022 as compared to INR 1802.87 crore a period one year ago, registering a growth of 45.29 percent Y-O-Y basis.

However, the quarter-on-quarter revenue of the company grew by 10.33 percent (revenue of INR 2374.21 crore for the period ended 31 March 2022)

 

Must Read: Nifty prediction for August 2022

 

Total Expenses of the Company –

INR 2307.67 Cr as on 30 June 2022,

INR 1401.04 Cr as on 30 June 2021,

INR 1993.21 Cr as on 31 March 2022

 

Profit after Tax

The Company, on a consolidated basis, registered a net profit of INR 306.96 Cr for the period ended 30 June 2022 as compared to INR 330.56 Cr for the same period last year, a fall of 7.14% Y-O-Y basis. While on a Q-O-Q basis, the PAT of the company de-grew by 18.11% (profit of INR 374.84 Cr for 31 March 2022)

An increase in raw material prices, higher employee benefit expenses, higher depreciation & other expenses are some of the reasons why Balkrishna Industries Limited posted a fall in profit after tax.

 

Dividend

The Board of the company has declared a 1st interim dividend of INR 4.00 per Equity Share (200%) on the Equity Shares of INR 2/- each (FV) for the financial year 2022-23.

 

EPS of the company stood as follows –

INR 15.88 as on 30 June 2022,

INR 17.10 as on 30 June 2021,

INR 19.39 as on 31 March 2022

 

Daily Chart –

 

balkrishna industries share price closed at INR 2323.70 (DOWN 2.73%) on the National Stock Exchange with a volume of 5,20,016 shares.

Balkrishna Industries Ltd is a value pick stock of Finblab and has given 2.6x returns when compared to ATH of INR 2700 and currently 2.25x returns from the recommended price of INR 1035.

 

Final Comment: Balkrishna Industries Ltd has posted a good set of numbers as far as the top-line is concerned while the bottom-line of the company has hit due to higher expenses across the segment. With the good monsoon in the country and a focused management team, the company hopes will do well in the future. Finblab maintains a Positive view on the company.

 

Also Read: Q1 Numbers of MAS FINANCIAL SERVICES LTD

 

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5 March 2018

Company Background –

History

Headquartered in Mumbai, India, Balkrishna Industries Ltd (BKT), the worlds premier manufacturer of pneumatic tyres for special applications was incorporated on November 20, 1961.

Business

• Since its founding, BKT has successfully focused on specialist segments such as agricultural, construction and industrial vehicles as well as earthmoving, port and mining, ATV, and gardening applications.
• BKT has developed into a global player in the Off-Highway tyre industry with a 6% market share and a sales volume of 850 million US dollars corresponding to a 30% increase over the last five years.

Product Portfolio – Balkrishna Industries

The company has three business activities under their umberlla namely –

(1) Tyre,

(2) Paper, and

(3) Textile Processing

 

The Tyre business is a focused business activity of the company that constitutes more than 80% of companys total business and by vitue of this becomes their core business.

• The Company’s high-end range of radial agricultural tires, developed to increase farmers’ business productivity. The Agrimax tire range includes the ultimate tires for high-power tractors, high-performance tractors, harvesters, sprayers and spreaders. Whatever your farming application is, the Agrimax tire range offers top performance always providing the best protection to your fields.
• BKT’s extensive range of radial OTR tires, designed to withstand even the harshest operating conditions in quarries, mines and construction sites. Enhanced by the common feature of a strong All Steel structure conferring the tire casing durability and excellent resistance against impacts, the Earthmax range of radial OTR tires is ideal to be fitted on dumpers, graders, loaders, dozers, on/off trucks and load haul dumps.
• BKT’s specialized range of radial port tires, able to meet the demanding requirements in logistics and port handling applications. The Portmax tire lineup includes the ultimate tires for reach stackers and straddle carriers. Strong and solid under the toughest operating conditions, these port tires handle even the heaviest loads maintaining excellent stability.
• BKT’s wide range of radial MPT tires, conceived to cover a large variety of manifold agro-industrial applications. These versatile all-round talents of MPT tires can perform in many challenging environments on different kinds of surfaces. The Multimax range is ideal to be fitted on telehandlers, compact loaders, backhoe loaders and universal vehicles.
• BKT’s range of radial crane tires, ideal for the most demanding construction applications. Since crane tires are subject to stress and extreme usage conditions, an essential feature of the Airomax tire range is to provide excellent heat resistance. High speed during road transfers and reliability in lifting operations make the Airomax tire range the right choice for your cranes
• BKT’s tire range of radial transport tires, ideal for both field and road-haulage operations. As a response to the increasing demand for farmers’ profitability, the Ridemax tire range allows to carry heavy loads at higher speed to increase the productivity of cutting-edge large farming equipment. The Ridemax range is suitable to be fitted on trailers, tankers and spreaders.
• BKT’s high-end range of radial agricultural tires, developed to increase farmers’ business productivity. The Agrimax tire range includes the ultimate tires for high-power tractors, high-performance tractors, harvesters, sprayers and spreaders. Whatever your farming application is, the Agrimax tire range offers top performance always providing the best protection to your fields.

In order to pay more attention to their various business activities, the company transferred their Paper business and Textile Processing business to their wholly owned subsidiaries, Balkrishna Paper Mills Ltd and Balkrishna Synthetic Ltd respectively with effecti from April 1, 2007.

BKT Tyres – Manufacturing Facilities

• BKT tyres are entirely manufactured in India at their three main production sites in Aurangabad, Western India, and Bhiwadi and Chopanki situated in North India.
• In addition to these, there is their mold production plant in Dombivali, north of Mumbai, and a new production site of Bhuj, in the Gujarat region in Western India.

Balkrishna Industries – Management Team

Balkrishna Industries (BKT) is managed by Arvind Poddar – Chairman & Managing Director, Rajiv Poddar – Joint Managing Director along with a highly professional executive team.

Listed On

The company’s shares are listed for trading on National Stock Exchange (NSE) & Bombay Stock Exchange (BSE) in India.

Stock Information

Share Holding Pattern

Balkrishna Industries – Financials

 

Conclusion –
Balkrishna Industries Limited has presented good set of numbers in Q3 – Fy 2017-18,

the company promoters have increased their stake in the quarter to 58.3% from 54.37%, and

the way natural rubber prices are falling all these are certainly positive for the company

Considering the techno-funda analysis and sector outlook; Balkrishna Industries Limited (BKT Tyres) looks good at Rs 1035. FinBlab recommends investing in a stock keeping a long-term view in mind. (One can accumulate on decline also).

 

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Disclaimer: The contents and data presented here are just for your information & personal use only. While much effort is made to provide the information, I ( Vishal Dalwadi ) or “Fin Blab” do not guarantee the accuracy, correctness, completeness or reliability of any information or data displayed herein and shall not be held responsible.

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