At a meeting held today, the Board of Directors of SRF Limited approved the unaudited Financial Results for the quarter ended 30^th September, 2002.

The company recorded Net Sales of Rs.180.52 cr (Q2, FY 2002-03), which increased by 19.01% from Rs.151.68 cr over the corresponding period last year.

Total Expenditure increased 13.39% from Rs.124.05 cr last year, to Rs.140.67 cr this quarter (Q2, FY2002-03).

As a result, Profit before Interest Depreciation & Tax (PBIDT) increased by 46.98%, and stood at Rs. 41.89 cr this quarter (Q2, FY2002-03) compared to Rs.28.50 cr in the same period last year.

Interest and Financial Charges at Rs. 11.57 cr (Q2, FY2002-03) increased by 4.71% as compared to Rs.11.05 cr. in Q2, FY2001-02.

Cash Profit (Profit after Interest but before Depreciation and Tax) increased by 73.75%, and stands at Rs. 30.32 cr this quarter (Q2, FY2002-03) compared to Rs.17.45 cr in the same period last year.

Profit Before Tax has increased 224.07%, from Rs. 5.90 cr (Q2, FY2001-02) to Rs.19.12 cr (Q2, FY2002-03).

Deferred Tax for the quarter ended 30/9/02 amounting to Rs 5.79 cr has been provided based on the estimates in accordance with the Accounting Standard (AS-22) issued by the Institute of Chartered Accountants of India. Any excess/ short provision shall be suitably adjusted in subsequent quarters. For the quarter ended 30/9/01 it has been taken proportionately, based on the audited deferred tax of Rs 7.82 cr for the year ended 31/3/02.

Profit After Tax at Rs.12.08 cr (Q2, FY2002-03) increased by 177.70% from Rs.4.35 cr for the same quarter last year.

Mr. Ravi Sinha, CEO, commented:

• The numbers have been achieved because of a sharp spurt in volume growth in both our major businesses, Tyre Cord Fabrics and Refrigerant Gases.
  
  
• In Refrigerant Gases, profits improved on the back of a revival in demand for air conditioners and refrigerators, and the effects of an extended summer. There is a seasonality in the Operating Profits of this business, with Q1/Q2 profits and sales in the summer months being higher than in the rest of the year.
  
  
• In Tyre Cord Fabrics, volume improvement came from the fact that the newly acquired Gummidipoondi facility (the erstwhile Dupont Fibers Ltd) saw a 100% capacity expansion, which has now been utilized fully.
  
  
• We do not believe that the growth momentum will be sustained in the short term. Even though the YoY comparison shows a sharp improvement in bottomline, the sequential quarter (QoQ) performance is flat.
  
  
• In Q2, the price hike effected in Tyre Cord Fabrics neutralized the input cost increases, but has given us only a marginal improvement in conversion margins.
  
  
• Going forward, performance will be affected by a sharp increase in input costs, not matched by increase in product prices. The outlook is therefore, somewhat negative.
  
  

SRF is the Indian market leader in Industrial Nylon and Refrigerant Gases. It is the 7th largest producer of Nylon Tyre Cord Fabrics, and the 5^th largest producer of Belting Fabrics in the world. In Refrigerant Gases, it provides world class products to its customers in 46 countries, including US. It also has a presence in the field of IT-Enabled Services. The group has 6 plants across India with overseas operations at Dubai.