- Best first quarter performance in the history for the company
- Revenue at INR 137.3 crore, 100% improvement over corresponding quarter
- EBITDA margin at 15.1%, the best for the first quarter in any financial year
- PAT at INR 8.2 crore, compared to a loss of INR 11.8 crore in corresponding quarter
- Management, witnessing strong business growth, increases its standalone sales growth guidance to 35% for the year
Mumbai,: Setco Automotive Ltd. (NSE: SETCO | BSE: 505075), the largest manufacturer of clutches for M&HCV in India, published its financial result for the quarter ended June 30, 2018. The company reported revenue of INR 137.3 crore in the quarter ending June 2018, up 100% against INR 68.6 crore in the corresponding quarter ended June 2017. It is the best first quarter performance in the history for the company.
Setco reported an EBITDA margin of 15.1%, which is the best for the first quarter in any financial year. The company posted a net profit of INR 8.2 crore, compared to a loss of INR 11.8 crore in the corresponding quarter. The company management, witnessing strong business growth, increases its standalone sales growth guidance to 35% for the year from prior guidance of 30%.
The quarter witnessed a robust industry growth in OE segment for M&HCV, a strong order pipeline from both OES and Independent Aftermarket segments. Improved segment mix, better efficiency (higher activity levels), and realisation of development efforts (farm tractor) will further enhanced EBITDA margin by over 100bps. With the recent introduction of new generation clutches in US Aftermarket, the company expects a growth trajectory in international markets too. Lava Cast, the state-of-the-art casting business of Setco, has started supplying to external customers such as TATA Motors, Ashok Leyland, etc.
Speaking on the results, Harish Sheth, Chairman & Managing Director at Setco Automotive, said, “Strong economic fundamentals on the back of implementation of GST, continue to drive M&HCV segment growth. This growth trend is seen for the last 4 quarters in a row and the growth cycle is expected to continue for the next 3 to 4 years. Government’s thrust in the rural sector and investment in infrastructure, higher MSP augurs well for our planned foray to supply new generation clutches into the farm equipment sector.”
This is our strongest Q1 performance in the history of the company, and we expect to continue strong growth with better cost management.