Industrial explosives maker Solar Industries today reported a marginal rise in net profit during the quarter ended September 30, 2016. Its net profit rose to Rs 36.93 crore during the quarter under review from Rs 36.86 crore in the corresponding period last fiscal, a company statement said.
The company’s total income also declined marginally to Rs 350.88 crore from Rs 356.56 crore in the year ago period, it said. “The second quarter is generally sluggish as mining takes a back seat due to monsoons. This quarter witnessed heavy monsoons which impacted production in Coal India, SCCL and stalled the infrastructure, construction and housing projects,” Solar Industries CEO and Executive Director Manish Nuwal said.
He further said that in spite of the slowdown, the company observed a domestic growth of 3.84 per cent on account of volume growth in all product segments except bulk explosives. Cartridge explosives have registered a growth of 22.26 per cent, detonators rose by 26.85 per cent and detonating fuse increased by 118.40 per cent, respectively.
Nuwal further said that currency devaluation added to translational loss of Rs 11 crore during the quarter. “The African continent is currently witnessing a mining slowdown and the economy is getting affected due to currency devaluation. We expect it to stabilise in the next 2-3 months,” he said. He said the manufacturing plant in South Africa is already commissioned and the production is likely to commence in the fourth quarter of current financial year.
Currently, the company has an order book of Rs 72.78 crore from Defence and part of the orders will be executed in the fourth quarter with a carry forward to the next year. “More orders are in pipe line. With the Indian government’s thrust towards increasing Defence tie ups with other countries and with the growth in mining activities in second half of the financial year, we continue to maintain our positive outlook towards the business,” Nuwal added.