Castrol Q1 results: Net profit nearly doubles on higher sales, cost-cutting

MUMBAI: Leading lubes player on Monday reported near doubling of net income for the quarter to March at Rs 243.6 crore as against Rs 125.2 crore a year ago, driven by robust revenue growth.

Revenue grew to Rs 1,138.7 crore in the reporting quarter from Rs 688 crore a year ago. Its revenue for the full year ended December 2020 was Rs 2,996.9 crore, when it had a net income of Rs 582.9 crore.

The company delivered robust revenue and profit growth with Q1 revenue from operations growing 66 per cent to Rs 1,138.7 crore and net profit nearly doubling to Rs 243.6 crore from Rs 125.2 crore, Castrol India Managing Director Sandeep Sangwan said in a statement.

He attributed the good set of numbers to the focused investments, interventions and actions taken in the second half of 2020. These included brand building with increased marketing and advertising spends, new product introductions as well as corrective pricing.

This has been aided by improving demand trends especially in tractor and SUV sales in during the reporting quarter.

He further said cost efficiency programmes and judicious working capital management led to healthy cash from operations of Rs 269 crore in the quarter, which is equivalent to 1.1 times of net income.

The second wave of the pandemic is resulting in a 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 going forward, the company said.