Shares of VST Tillers Tractors advanced 10 per cent to Rs 1,938 on the BSE in the early morning deals on Wednesday after the company posted nearly five-fold year-on-year (YoY) jump in net profit at Rs 29.94 crore in September quarter (Q2FY21) on back of healthy revenue. The commercial vehicles company had clocked a profit of Rs 6.4 crore in Q2FY20 and Rs 17.1 crore in Q1FY21.
Net sales for the quarter came in at Rs 220 crore, up 37 per cent YoY. EBITDA (earnings before interest, taxes, depreciation, and amortization) margins improved 590 basis points sequentially at 17.1 per cent from 11.2 per cent in Q1FY21 and 2.4 per cent in Q2FY20.
The power tiller sales volume for Q2FY21 was at 7,924 units, up 41 per cent YoY while tractor sales volume was at 2,751 units, up 25 per cent YoY. VST generated around Rs 140 crore as cash from operation (CFO) and remains a debt free company.
"Margin performance for the quarter was a positive surprise. This, coupled with import restrictions on power tillers bodes well, with VST well capable of clocking incremental sales and profitability, going forward," ICICI Securities said in a note.
At 10:51 am, the stock was trading 8 per cent higher at Rs 1,895 on the BSE as compared to 0.61 per cent rise in the S&P BSE Sensex. The trading volumes on the counter rose an over eight-fold with a combined 110,000 shares having changed hands on the NSE and BSE till the time of writing of this report. The stock hit a 52-week high of Rs 1,949.30 on September 21, 2020.