Eveready Q2 net drops 46% to Rs 31 cr on dip in high-margin battery sales

Eveready Industries India recorded a 45.75 per cent drop in consolidated net profit to Rs 31.04 crore in the September quarter. It was at Rs 57.22 crore in the same period last year.

Revenue from operations were at Rs 357.49 crore, down 4 per cent. The company said that consumption reduced significantly in the Covid-related medical devices, which use higher-margin batteries, with the situation related to the pandemic improving significantly in the country. That impacted the battery turnover.

Moreover, flashlights business showed a “soft trend” due to a high volume of low-cost products dumped by China. Higher cost of inputs, led by overall increases in commodity prices also impacted and the company could not entirely pass it on to the market, which resulted in lower margins.

Given the improvement in the Covid pandemic situation, the company believes that the consumption of high-margin batteries in medical devices is not likely to repeat and the performance of last year may be seen as a one off.

In this scenario, efforts will be concentrated to optimize product mix to deliver higher margins, the company said.

The company also said that it will explore countermeasures against the large-scale dumped flashlights from China.