Gandhimathi Mar-10 results update
Mar-10 qtr sales up 50% yoy and EBIT up 53% yoy. trailing 12 months sales up 60.4% and EBIT up 75%. Gandhimathis sales growth is much higher than the peer cos like Hawkins and TTK (around 20% sales growth) while reasons for such higher than industry growth are not known. It could be either product mix (gandhimathis is more into gas stoves-which might be growing faster!) or market share gaining from TTK (thru some value proposition!). 75% ebit growth comes mostly from sales growth while cost as % of sales remaining stable.
One long term factor to be closely watched is the cost structure alignment between gandhimathi, ttk and hawkins. Currently gandhimathis margins r lowest at 11% (ttk-15% and hawkins 21%) due to higher COGS as % of sales. With increasing sales volumes gandhimathi may benefit by opting for higher outsourcing. Balance sheets wise ttk and hawkins are pretty strong with zero debt and good cash balances. Gandhimathi has 27 cr of debt around 1.4x ebitda (within prudential norms!)
posted by jagadish @ 1:45 PM
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