The European business, fourth largest contributor to sales, grew 37 per cent. The company benefited from its Portuguese acquisition, though adjusting for the acquisition, the organic growth rates seems high, say analysts. The company has transferred the manufacturing of 74 products from Europe to India, to drive profitability.
Though its financials beat estimates, operational performance could have been better but for a number of unquantified provisions in both raw material cost and other expenditure that somewhat clouded the reported numbers, say analysts. While revenue was Rs 4,436 crore, operating and net profit stood at Rs 1,117 crore and Rs 781 crore, respectively.
Debt increased from $439 million at the end of FY17 to $616.4 million, due to acquisitions and higher working capital requirements. Analysts, expect this to come down to $475 million by the end of FY18, with strong cash flow. Ranjit Kapadia at Centrum Broking and Ranbir Singh at Sytematix Shares said they were positive on growth prospects.