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 Financial Results for the Quarter Ended 30th June 2008
Tube Investments of India
Tube Investments of India
CHOLAMANDALAM FINANCIAL HOLDINGS LIMITED
(Formerly, TI Financial Holdings Limited)
Financial Results for the Quarter Ended 30th June 2008
 
Quarterly Financial Results Of Tube Investments Of India Limited - Turnover & Net Profit UP

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, 2008.

During the quarter sales were at Rs. 538.16 Crores, as against Rs.433.22 Crores during the same period last year. The net profit for the quarter was at Rs.56.62 Crores. The profit for the quarter includes a gain of Rs. 31.84 crores on sale of certain long term investments. The net profit for the corresponding quarter in the previous year was Rs. 21.67 Crores. The operating profit (EBITDA) earnings before interest, tax and depreciation registered a growth of 17% over the corresponding quarter last year. Mr. L. Ramkumar, Managing Director said, ”This was achieved despite steep increase in input costs of which only a part was compensated by customers. The shortfall was offset by higher volume, better product mix and improved internal efficiencies.”

Sales of Cold Rolled Steel Strips during the quarter grew marginally while Cold Drawn Welded Tubes grew significantly at 15%. The increase in steel price and reluctance of customers to compensate us for the same are affecting our profitability. Export of tubes was lower during the quarter due to the slowdown in the North American markets as well as the “export duty” imposed by the Government of India for a period of one month from the middle of May’08. These factors have affected the profitability of the export operations. Sales of value added tubular components increased two fold during the quarter.

The sale of bicycles continued to be robust and grew by 8% overall. The growth in our focus specials segment was 10%. The high end models introduced over the last few quarters have been well received by the market. The division increased the number of exclusive retail outlets under the BSA Go brand to 35 and also increased the Hercules Bike Zone outlets to 51.

The revenue from Metal Formed Products grew by 32%. The growth largely came from the higher sale of cold rolled formed sections for railway wagons. The sale of car doorframes was also higher by 36%. The sale of automotive chains was higher by 30% on the back of a modest revival in the two wheeler industry.

While the threat of higher steel prices, significantly higher interest rates and a not too-good monsoon are matters of concern, the company hopes to sustain its operating results across all its divisions.


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 Rs.9582 Crore (USD 2.4 billion) Murugappa Group is India’s leading business conglomerate. Market leaders in diverse areas of business including Engineering, Abrasives, Finance, General Insurance, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Bio-products and Nutraceuticals, its 29 limited companies have manufacturing facilities spread across 13 states in India. The organisation fosters an environment of professionalism and has a workforce of over 30,000 employees. The Group which has forged strong joint venture alliances with leading international companies like DBS Bank, Mitsui Sumitomo, Cargill, China Engineering & Exploration Bureau and Groupe Chimique Tunisien, has consolidated its status as one of the fastest growing diversified business houses in India.
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