KET announces 31% increase in sales for quarter ended June 30, 2008

Kabra Extrusiontechnik Limited, India's largest manufacturer and exporter of plastic extrusion machinery, today announced results for the quarter ended June 30, 2008. Highlights o Sales increased by 31% to Rs. 35.93 cr. o Domestic sales increased by 13% to Rs. 20.81 cr. and contributed 58% to sales o Exports increased by 70% to Rs. 15.12 cr. and contributed 42% to sales o Other income includes profit on sale of investments of Rs. 1.54 cr. o Other expenditure is significantly higher due to overall increase in costs including sales and marketing initiatives in export markets o Net Profit (including profit on sale of investments) increased by 105% to Rs. 3.95 cr. o Net Profit (excluding profit on sale of investments) increased by 25% to Rs. 2.41 cr. o Product prices increased to pass on the higher costs o Strong order book Commenting on the performance, Mr. S. V. Kabra, Chairman and Managing Director said, "Leadership in pipe plants used in agriculture and strong demand for multi-layer blown film plants used in flexible packaging have enabled us to report healthy growth. We expect business environment to remain good for rest of the year." Indian plastic industry is worth about Rs. 55,000 cr. with exports of Rs. 13,000 cr. It is expected to become the 3rd largest market after USA and China in next five years. The extrusion machinery industry, being linked to plastic consumption, has significant growth potential. The domestic production of extrusion machinery for pipes, films, tapes, sheet lines, profiles, pelletising, etc. is around Rs. 700 cr. Demand is growing in double digit, driven by thrust on agriculture, water management, construction, telecom, packaging applications, organized retailing, etc. Global extrusion machinery industry is worth over US$3 billion. India has the potential to become an outsourcing hub due to its low cost, strong manufacturing base, strategic location and intellectual capabilities. The company already exports its products to over 60 countries and entry into new markets would drive growth. It has an installed base of around 6700 plants including 1200 overseas. Closer relationship with collaborators would help expand customer base in several markets. Kabra Extrusiontechnik is the largest manufacturer and exporter of plastic extrusion machinery from India. The company has an overall market share of around 20% and share of 65% in Pipes, the fastest growing segment. It plans to garner higher share of domestic market through new product introductions in existing and new segments. The company developed more than 30 new models last year and further 20 new models are under development in the current year. It continues to be the most efficient player in the industry with sharp focus on costs and quality. The company has diversified and de-risked its operations in terms of customers and geographies. Its customers include polymer producers such as Reliance, IPCL, GAIL, Haldia Petro, etc for product testing/development and polymer processors such as Supreme Industries, Sintex, Chemplast, Polycab, Prince Group, Kisan Group, PSL, Kriti Industries, Precision Group, Duraline, Uma Group, etc. The company scores over its peers in financial parameters like profitability, cash flow and strength of balance sheet. Considering its leadership, large market potential, technological innovation and foreign collaboration, Kabra Extrusiontechnik is confident of its business prospects.
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