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31st July, 2007
Financial Results Of Tube Investments Of India Limited
The Board of Directors of Tube Investments of India Limited (TII)
met today and approved the un-audited financial results for the first quarter
ended 30th June, 2007.
In Q1, the sales were Rs.472.79 Crores, as against Rs.413.55
Crores for the same period last year. The net profit for the quarter was at
Rs.14.09 Crores. The net profit for the corresponding quarter in the previous
year was Rs. 89.46 Crores, which included Rs. 71.30 Crores towards profit on
sale of long term investments.
Despite the downturn in the 2-wheeler industry, the off-take
of tubes was marginally higher compared to the corresponding quarter of the
previous year. However, the margins were low on account of change in product-mix
and non-absorption of increase in input cost by key customers. The export orders
for precision tubes have been encouraging, but the significant appreciation of
the Rupee against the dollar is a matter of concern.
The tube manufacturing facility being established by Tubular
Precision Products (Suzhou) Co. Limited, a wholly owned subsidiary, near Suzhou
in China is nearing completion. The commissioning of the plant is expected to
take place in this quarter.
The sale of automotive chains to the OEMs witnessed a
downturn in line with the performance of the 2-wheeler industry during the first
quarter. However, the sale of industrial chains improved significantly, both in
the domestic and export market. The sale of car doorframes was marginally lower
on account of lower sales of older models of cars of our customers. The
doorframe sale of the new models is expected to pick up in the forthcoming
quarters. The Company is confident that the revenue stream from the new products
would stabilise later this financial year.
The sale of standard as well as special bicycles improved
significantly. In view of the brand equity enjoyed by the Company in the market
place, the Company was able to improve on its margins despite stiff competition.
The focus in the bicycle business continued to be on restructuring the
distribution network. The initiatives towards rationalisation of dealer network
and establishment of new dedicated outlets under the style “BSA Go” enabled
us to perform better.
About Tube Investments of India
Tube Investments of India consists of TI Cycles of India,
Tube Products of India, TI Metal Forming (including Chains). In bicycles, TII is
the second largest manufacturer with well-known brands - Hercules, BSA and
Philips. TII is the market leader in precision steel tubes and roll-formed car
doorframes in India. Also, being the second largest motor cycle chain
manufacturer in India, TII is a major supplier to the Indian auto / auto-
component industry.
About the Murugappa Group:
Headquartered in Chennai, the $1.6 billion Murugappa Group is
India’s leading business conglomerate, which fosters an environment of
professionalism for its strong workforce of 28,000 employees. The group has 29
registered companies, which are market leaders in diverse areas on business viz.
engineering, abrasives, finance, general insurance, sanitary ware, cycles,
sugar, farm inputs, fertilizers, plantations, bio products and nutraceuticals.
The Group has manufacturing units in 12 states.
The Group has forged strong joint venture alliances with
leading international companies like Roca of Spain, Cargill of Geneva, Cerdak of
South Africa, Jingri Diamond Industrial Company of China, DBS Bank of Singapore,
Mitsui Sumitomo of Japan and Groupe Chimique Tunisien of Tunisia and has
consolidated its status as one of the fastest growing diversified business house
in India.
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