Castrol India soars after stellar Q1 performance

Castrol India jumped 4.39% to Rs 130.75 after the lubricants maker reported 94.6% jump in net profit to Rs 243.60 crore on 65.5% increase in net sales to Rs 1138.70 crore in Q1 March 2021 as compared to Q1 March 2020.

Profit before tax in the first quarter stood at Rs 332.30 crore, up by 96% from Rs 169.50 crore in the same period last year.

Sandeep Sangwan, managing director, Castrol India, said: "Focused investments, interventions and actions taken in the second half of 2020 towards brand building with increased marketing and advertising spends, new product introductions as well as corrective pricing have yielded a positive impact on overall topline growth. This has been aided by improving demand trends especially in tractor and SUV sales in 1Q 2021.

Our cost efficiency programmes and judicious working capital management efforts led to healthy cash from operations at Rs 269 crore in the quarter, which is equivalent to 1.1 times of profit after tax.

The second wave of the Covid-19 pandemic in India is resulting in a market slowdown in various parts of the country. In addition, supply disruptions on account of base oil and raw materials availability, logistics challenges and rupee depreciation are likely to adversely impact demand and supply."

Castrol India manufactures and markets automotive and industrial lubricants and specialty products. The company's products include lubricating oils, greases and brake fluids.

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