Prakash Pipes Ltd announces financial results for the quarter ended June 30, 2020

During the quarter ended 30th June 2020, the Company has achieved Net Sales of Rs.88.39 crores. The EBITDA, at Rs.1 2.64 crores, grew by 16.92% as compared to corresponding quarter of last year. The Net Profit stood at Rs.7.29 crores, higher by 13.90% as compared to corresponding quarter of last year. The operating profit increased on account of better sales realization, cost control measures and turnaround of flexible packaging division.

The COVID-19 pandemic has caused significant disturbances and slowdown of economic activity. The Company had to suspend its operations in both divisions during March - April 2020. With regulatory approvals in place, operations were gradually restarted by third week of April.

Outlook:

Despite the challenging economic environment due to the COVID-19 pandemic, the Company is currently operating its manufacturing capacities at near optimum utilization levels as demand is robust from essential sectors such as agriculture & infrastructure for PVC pipes & fittings, and FMCG & pharmaceuticals for flexible packaging, which is expected to further improve in coming quarters.

The Company's expansion in its high margin and high growth range of PVC fittings is under implementation.

Looking at the growth prospects in the packaging industry, the Company is doubling its flexible packaging capacity in the current financial year.

The expansions are being funded entirely through internal accruals.

Source : Equity Bulls

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