Varroc Engineering Ltd share Price Today

Auto Parts & Equipment company Varroc Engineering announced FY24 results:

• Consolidated revenue from operations was Rs 75,519 million in FY24
• Consolidated PBT margins in FY24 were at 4.2%, improved by 300 bps
• Net Debt/Equity improves to 0.64 in FY24 from 1.27 in FY23
• Strong new order lifetime win of Rs 87.0 billion in FY24

Tarang Jain, CMD commented, “The global economy faced several uncertainties during FY24 due to intensified conflicts in Europe and Asia. The expectations for decisive rate cuts across the world have been moderated in recent times, as underlying inflationary pressures are not easing as fast as expected. However, the risk of global recession seems to be receding now. We hope that the geo-political issues don’t escalate further. The Indian economy continues to outperform and in Q3 FY24 the GDP growth was robust 8.4%.

The automobile sector in India registered growth across all segments during FY24. The passenger vehicle segment grew by 6.9% and CV segment by 3.0%. The 3W and 2W segments registered strong growth of 16.0% and 10.3% respectively. Strong domestic demand and stable economy have enabled this growth.

In Q4FY24 on YoY basis, the automobile growth was strong with 2W growing by 26.5%, 3W by 8.4% and PV by 9.7%. The CV segment saw a marginal de-growth of 0.5%.

For the full FY24, our India operations continued to deliver strong performance with growth of over 14.1%. Our overseas business was impacted in FY24 due to significant degrowth in 2W automotive sales and heavy customer concentration in certain overseas markets.

The full year revenue was Rs. 75,519 million, the PBT for the year was Rs. 3,149 million which includes profit from our joint venture of Rs 444 miilion. The PBT margin improved by 300 basis point on YoY basis and came at 4.2%. PBT for the year. PBT was also impacted by certain onetimers like the provision of Rs.160 million created for doubtful recovery of receivables from an EV customer.

In FY24 the capex spent was Rs. 2,016 million. Thus, better profitability, tighter control on capex & working capital enabled us to reduce the net debt to below Rs. 10,000 million at Rs. 9,826 million. The Net Debt to Equity ratio improved to 0.64 in FY24 from 1.27 in FY23. The loan servicing ability also improved as our Net Debt to EBITDA improved to 1.29 in FY24 from 2.13 in FY23."

Result PDF