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Shrenuj's 4Q Sales +11%, Profits +3%
May 29, 2012 3:43 AM
By Dilipp S Nag
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RAPAPORT... Shrenuj & Co. Ltd. reported that group net sales rose 11 percent year on year to $147 million (INR 8.13 billion) during its fourth fiscal-quarter that ended on March 31, 2012. The growth was driven by strong diamond sales. Net profits, however, increased only 3 percent to $2.4 million (INR 131.6 million) during the quarter as expenses and finance costs rose while other income declined.
“We are pleased with the performance of the company, especially since the year 2011-2012 was particularly challenging. The input prices of raw material, diamonds and gold were on the rise. The economic uncertainty added to lowered sales revenues in euro zone,” said Shreyas Doshi, the chairman of Shrenuj. “The rise in U.S. demand was compensated by slightly subdued growth rates in China. In this scenario, our focus was on preventing credit risk while sustaining growth.”
The diamond and jewelry manufacturer reported that diamond segment sales rose 18 percent to $126.9 million (INR 7.02 billion), while sales at its studded jewelry business fell 9 percent to $26.3 million (INR 1.45 billion). Inter-segment revenue rose 50 percent to $6.2 million (INR 341.1 million).
Group expenditures rose 8 percent to $137.4 million (INR 7.60 billion) while finance costs jumped 62 percent to $6.7 million (INR 369.5 million) during the quarter. Other income declined 80 percent to $251,310 (INR 13.9 million).
For the fiscal year, Shrenuj’s net profit rose 24 percent year on year to $12.7 million (INR 703.4 million) while net sales increased 28 percent to $569.6 million (INR 31.51 billion).
The company noted that the rise in sales was due to widening consumer base and expanding to new markets. During the year, Shrenuj commissioned a jewelry-manufacturing unit in Botswana and a diamond-polishing unit in South Africa. It also secured a significantly large supply contract for 2012-2015 under supplier of choice initiative with Diamond Trading Company (DTC) London and DTC Botswana. The company plans to expand its diamond polishing manufacturing by commissioning another large-scale factory in India later this year.
Shrenuj’s operations span 29 cities in India through its ''Diti'' retail venture, which has 175 points of sale. The Mumbai-based company also has a presence in Hong Kong through its ''Joliesse'' brand retail stores. It has manufacturing units in India, Botswana and Israel and the bulk of its revenues are derived from its diamond sales.
Shrenuj’s stock was up 5 percent at INR 83.50 per share during mid-day trade Tuesday on the Bombay Stock Exchange.
*Note: All data was published in rupee. Any references to U.S. dollar amounts were made according to exchange-rate conversions by Rapaport News.
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Tags:
Botswana, diamond, diamonds, Dilipp S Nag, Diti, DTC Botswana, DTC London, Euro zone, India, Jewelry, Joliesse, Rapaport, Shrenuj, Shreyas Doshi, South Africa, US
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