CASTROL

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   I could not find any topic on Castrol and hence I created this new topic. In case there is topic existing, then this can be merged with the same. I remember that we had some discussion on this earlier but could not find anything. 

This company keeps on performing Y-o-Y and quite stupendously despite increasing prices, reducing consumption. It is a very strong brand. On top of that it is a great dividend payer. For FY10 they are paying 15/per share on expanded capital

The last qtr results/FY 10 results are noted below. 

Release date: 22 February 2011 
Another record year for Castrol India 

FY PAT up 28.7% at Rs. 490 crore, Turnover up 18%

In Rs. crores

Q4
Oct – Dec 2010

Q4
Oct – Dec 2009

Q4
% Increase

Jan- Dec 
2010

Jan – Dec 2009

% Increase

Net Sales

695.8

609.5

14.2%

2734.7

2318.2

18.0%

Profit Before Tax

158.8

122.8

29.3%

737.8

580.8

27.0%

Profit After Tax

105.9

80.8

31.1%

490.3

381.1

28.7%

Castrol India Limited today announced its audited Annual Financial results for the period January – December 2010. The company delivered a strong performance for the period under review. Net Sales were up 18% to Rs. 2734.7 crores compared to the previous year and Profit after Tax grew by 28.7% to Rs.490.3 crores. 
At the Board Meeting held today, the Company has declared a final dividend of Rs. 8/- per share. The Company has already paid an interim dividend of Rs. 7/- per share. Hence the total dividend paid for the financial year January – December 2010 is Rs. 15/- per share. Both the said dividends have been paid on the enhanced share capital post issue of Bonus shares. (The Company had allotted in April 2010 bonus shares in the ratio of 1:1). The total dividend paid for the year 2009 was Rs.25/- per share (which included a Special dividend of Rs. 10/- per share). However, the dividend for the year 2009 was paid on the old share capital i.e. prior to the issue of Bonus shares. 

Commenting on the Full Year results, Mr. Naveen Kshatriya – Vice Chairman, Castrol India Limited, said, “Castrol India has delivered yet another set of record results with growth in sales, unit margins and profits. The margin improvement has been achieved through a combination of higher sales of premium products and higher unit realization through strategic pricing actions. 
The company continued its efforts in aggressively pursuing cost efficiency and cost effectiveness programmes. What is significant is that this saving was achieved despite continued investment in people, brands and infrastructure, with a view to building long term sustainable growth. 

During the year under review, the company initiated several marketing programmes in the automotive business, aimed at achieving a stronger connect with its customers. The company successfully leveraged Castrol’s global sponsorship of the FIFA World Cup 2010, through a comprehensive communication campaign. The company also entered into a five year sponsorship deal with the International Cricket Council (ICC), tying up as its Official Performance Partner. A huge advertising and promotion campaign is currently on to leverage this partnership which is expected to contribute significantly towards strengthening the Castrol brand further and driving higher sales. 
The company also intensified its activities in rural markets through the Sanjeevani programme through which we directly contacted farmers in 35,000 villages. 

The Industrial business also posted robust growth delivered through high performance products and differentiated solutions for our customers. Enhanced distribution reach and strategic tie ups with key partners also helped drive the growth in this segment. 
On the Social Investment front, Castrol has embarked upon an ambitious mechanic training programme - “Eklavya,” aimed at large scale training to enhance technical capability of independent mechanics. To date, the company has trained over 20,000 mechanics. 

Outlook

We expect the economy to maintain the growth momentum. Growth in the lubricants industry is also likely to come from the personal mobility and infrastructure segments, both of which continue to show strong growth impetus. However, the steep increase in the cost of goods is expected to continue and this could impact margins. 
Despite this risk, we remain confident of sustainable growth in our financial performance. This is underpinned by superiority of our products, strong customer relationships, continued focus on improving the operational efficiency and sustained investment in brand and organizational capability building. It is supported by the unflinching commitment of our employees, our business partners and our loyal consumers. 

"

Though now again it is trading at slightly expensive valuations but if the stock comes down on expectations of margin compression due to crude price hike , it may be accumulated for people looking to build a solid large cap portfolio