Finance Update

JK Tyres Q3 FY19 PAT beat estimates

JK Tyres reported an impressive set of results for the Q3 FY19. The numbers came in ahead of estimates.

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Revenue from operations rose to Rs.2,731 crore as compared to Rs.2,123 crore in the same period previous fiscal, JK Tyre & Industries said in a regulatory filing.

JK Tyre & Industries on Thursday posted over two-fold increase in its consolidated net profit. The consolidated revenue at Rs.2,731 cr grew sharply by 29% YoY and was ahead of our estimates. Demand traction in the aftermarket segment & price hikes lead to the strong topline growth.

The operating margins at 9.7% declined 30 bps YoY and was broadly in line with our estimates of 9.9%. The raw material for the quarter (RM/Sales) is up 300 bps YoY. Strong topline growth led to benefits of operating leverage, which largely offset the impact of the hardening raw material cost.

The EBITDA at Rs.265 cr is up 24.5% YoY and is ahead of our estimates.

The interest cost for the quarter at Rs.131 crore, is up 14% YoY. Tracking the strong operating performance, the adjusted PAT stood at Rs.47 crore, up 123% YoY and comfortably beating our estimates of Rs.42 crore.

JK tyres an exceptional expense amounting to Rs.20.45 cr (unfavorable foreign exchange fluctuation Rs.18.14 cr & VRS – Rs.2.31 cr). The Reported PAT stood at Rs.26.7 cr.

The board of directors have approved issue of equity shares to the promoter group upto an amount aggregating to Rs 200 crore. The issue is subject to required approvals. Other details including the issue price and date is awaited.

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