Western region firms top India Inc

Housing construction, engineering, software, electronics and services firms located in the western region have outperformed India Inc in 2005-06 with a robust 138 per cent growth in net profit on the back of 16.9 per cent rise in net sales.

India Inc's sales growth last year was to the tune of 17.3 per cent and net profit growth 12 per cent.

Four hundred and four manufacturing firms of the region with net sales below Rs 200 crore (Rs 2 billion) each have been covered by the study. Larger companies of the region have been left out as they from an integral part of corporate India.

The aggregated net sales of these 404 companies was Rs 18,304 crore (Rs 183.04 billion) in 2005-06, up 16.9 per cent over the previous year net sales of Rs 15,661 crore (Rs 156.61 billion).

The operating profit margin of the pack rose to 16.50 per cent from 14.02 per cent. Consequently, the operating profit of these companies moved up by 37.6 per cent to Rs 3,021 crore (Rs 30.21 billion).

The net profit of the western region firms rose 137.6 per cent to Rs 1,215 crore (Rs 511 crore).

Of the 404 region firms, the net profit of 123 firms increased by over 100 per cent while 38 firms improved their net profit between 50 and 100 per cent and 35 between 25 and 50 per cent each.

As many as 84 companies were in the red and collectively registered net loss of Rs 408 crore (net loss of Rs 374 core).

Ongoing boom in the realty sector has been reflected in the performance of the most of the western region firms, which are in the field of realty developments.

Arrow Webtex, Peninsula Land Management (formerly Morarjee Realties), BSEL Infrastructure Realty, Mahindra Gesco Development, Victoria Mills, Phoenix Mills, Prime Property Development and Ruby Mills showed robust profit growth on account of their new venture in commercial property development.

Sanghvi Movers, Valecha Engineering, Lok Housing, Kamath Hotels, PBA Infrastructure, Patel Road Ways and Sunil Hitech were benefited from the infrastructure development programs.

The buoyancy in economy had its impact on companies such as Asian Electronics, Bombay Rayon Fashion, Amar Remedies, Micro Technologies, Kamat Hotels and PBA Infrastructure.

Peninsula Land tops the profit list of the western Region companies with net profit of Rs 77.18 crore (Rs 771.8 million) in 2005-06 against net loss of Rs 9.52 crore (Rs 95.2 million) in 2004-05. The company earned revenue of Rs 163.95 crore (Rs 1.63 billion) in 2005-06 against Rs 62.63 crore (Rs 626.3 million) in 2004-05.

Its other income stood high at Rs 20.43 crore (Rs 1.91 crore). Interest cost increased substantially to Rs 15.38 crore (Rs 0.05 crore).

Among other companies, Valecha Engineering posted net profit growth of 329 per cent to Rs 26.81 crore (Rs 268.1 million) while Asian Electronics' net profit rose by 134 per cent to Rs 25.15 crore (Rs 251.5 million) and that of Geodesic Information Systems 122.32 per cent to Rs 42.44 crore (Rs 424.4 million).

The company's sales were up by over 100 per cent to Rs 91.88 crore (Rs 918.8 million) from Rs 40.20 crore (Rs 402 milllion). Sanghvi Movers almost doubled its sales to Rs 149.05 crore (Rs 1.49 million) from Rs 75.38 crore (Rs 753.8 million) while its net profit rose 135 per cent to Rs 32.18 crore (Rs 321.8 million).