• Shekhar Yadav

Q2FY21 Quarterly Result Analysis – ICICI Securities Ltd, Oriental Aromatics Ltd, GMM Pfaudler

Updated: Jun 30

While tracking the numbers for Q2FY21 of various companies, I was amazed at the outstanding performance by almost all the companies. In the current blog “Q2FY21 Quarterly Result Analysis”, I will be covering the reason for the good results and the future ahead. 

Also, I will share my assumption at the beginning of COVID and learning from looking at the current situation.

My Assumptions at the beginning of COVID in March 2020:

When the lockdown started in March 2020, with everyone in India locked inside there homes, factories being shut indefinitely, I made these assumptions on the future:

  1. All Companies revenues will be a fraction of their previous one 

  2. General public is likely to preserve cash given the loss of jobs & create a cushion for the coming rainy days. So discretionary spending would be very marginal

  3.  The market surge that started in April 2020 will be short lived

  4. Companies are likely to hold on to their proposed expansion plans

But I was TOTALLY wrong. Other than Travel related companies such as Airlines, Luggage, Hotels almost all companies revenues fell merely by 10-30% in Q1FY21 despite all the points mentioned above. 

And coming to Q2FY21, just 3 months later, the performance given by the companies were just mind blowing amid the pandemic despite any sort of fiscal stimulus in India.

My Learnings observing the current performance of companies

  1. Market ALWAYS knows better. And buying cheap can never harm.

  2. The global economic downturn or slowdown which started in mid 2018, finally got over by Q4FY20.

  3. During slowdown, companies become much more efficient and when the upturn comes, the rebound is always stronger.

While Quarter on quarter growth is obvious but Year on year growth is remarkable. And its just not in India.  Also, there was lot of questions were asked from the management whether it is just a pent up demand and all the managements denied that.


Now, let me take you through the financial performance of companies which I have covered and I personally track.

Polycab India Ltd- Q2FY21 Quarterly Result Analysis

Q2FY21 Quarterly Result Analysis

Polycab India Ltd- Q2FY21 Quarterly Result Analysis​

Although Polycab’s sales declined on  a year on year basis, the margin improvement has been quite good.

I have covered the detailed quarterly Q2FY21 analysis here : Polycab India Ltd- Q2FY21 Analysis

You can also read the company analysis here: Polycab India Ltd- Analysis.

ICICI Securities Ltd: Q2FY21 Quarterly Result Analysis

Q2FY21 Quarterly Result Analysis

ICICI Securities Ltd: Q2FY21 Quarterly Result Analysis​

Brokerages are always one of the best performer in a bull market. During bull market, the operating leverage kicks in where with the incremental growth in revenue does not lead to proportionate increase in cost, thus enhancing the profitability. In Bull market people trade more. As of now, they have the lethal combination of high growth and high profitability.


Some of the tailwinds with the brokerage industry include highly under-penetrated investment market. Complete digital customer acquisition is helping them a lot in terms of cutting cost and continue their growth. In the current quarter they launched complete digital way of investing in US market which no other brokerages provide. 


For the company, Equities brokerage business doubled year on year(YoY) and even the investment banking business did well due to several new IPOs coming in.

Also, they did loan distribution of 300 cr just in this quarter for ICICI bank. ICICI securities charge a commission of 0.5% to 1% on loan disbursed amount.


This quarter the company further closed 15 more branches and reduced the head count given that things are going digital now. This reduces their fixed cost.

You can also read the detailed company analysis here: ICICI Securities Ltd- Playing the financialization theme

For the company greater than 65% of revenues between FY14 to FY20 was contributed by customers who have been with then for more than 5 years. Shows customer stickiness. 

Oriental Aromatics Ltd: Q2FY21 Quarterly Result Analysis

Q2FY21 Quarterly Result Analysis

Oriental Aromatics Ltd: Q2FY21 Quarterly Result Analysi​


Similar to Polycab, Oriental Aromatics Ltd saw its profitability increase immensely but a marginal dip in revenue. 


Everything went in the favor of the company. Lower raw material cost and higher demand for products. The management is expecting the raw material prices to increase in the future for which they already have stored good amount of raw material at low prices.


Camphor and Flavors & fragrance segment did significantly well.

Volumes are back to pré-covid levels. 


Fine fragrance such as deodorant & perfumes demand is expected to see revival in demand  in the current festive season. In Q1, this segment sales was negligible which has now recovered to 75% in Q2FY21.


Company reduced the debt by 33cr.

Operating at almost full capacity & hence in the process of expanding capacities.

You can read more about the company here: Oriental Aromatics Ltd- Analysis

GMM Pfaudler Ltd: Q2FY21 Quarterly Result Analysis

Q2FY21 Quarterly Result Analysis

GMM Pfaudler Ltd: Q2FY21 Quarterly Result Analysis

GMM Pfaudler has been in the news for the wrong reasons with respect to its crashing share price. The share price fell from almost ₹7000 level to current 3500 levels.


But if you look at the quarterly performance, after 3 quarters of stagnation, the revenue grew by almost 22%. To add to this the margins improved handsomely. This was mainly on account of 2 new gas furnace coming on stream and higher amount of glass lined equipment sales. At full capacity these 2 furnace will manufacture 500 glass lined equipment's.


Going forward their acquisition of De Dietrich Process Systems India at Hyderabad will also start contributing to the growth. De Dietrich has a capacity to manufacture 400 units of glass lined equipment.


The biggest problem faced by the company was capacity constraint but the on time coming up of 2 new gas furnace & acquisition of De Dietrich gives them comfort of keep up with the growth.


Also, the acquisition of their US based parent company i.e.  Pfaudler Inc will open many new doors for the company. GMM Pfaulder will be acquiring 54% in the parent and 26% will be bought by the promoters of GMM in their personal capacity. Remaining 20% will be held by the current private equity company. The transaction is expected to close by end December 2020.


Their order book at the end of the quarter stood at ₹350cr & 1100+ glass lined equipment. The order book for their subsidiary Mavag also looks good at 20Mn Swiss franc. Company is expecting the current growth to continue atleast for the next 2 quarters.


Coming to the valuation, the company is still very richly valued.


Good article to read on GMM Pfaudler’s current transactions: Link


You can read my analysis on GMM Pfaudler & Q4FY20 result analysis by following the below links:

GMM Pfaudler Ltd- A proxy to pharma & chemical industry capex

GMM Pfaudler Ltd- Q4FY20 Analysis


Bhansali Engg Polymers Ltd: Q2FY21 Quarterly Result Analysis

Q2FY21 Quarterly Result Analysis

Bhansali Engg Polymers Ltd: Q2FY21 Quarterly Result Analysis​

Another company which came out with good results was from BEPL. 


After a long time, there was sales growth coupled with margin growth. The end consumer i.e. Auto which contribute about 40-50% of topline has seen demand surging. The company derives higher margins from products catering to auto industry.


Along with the improved demand, the end product i.e. ABS is seeing its prices increase backed by good improvement in car sales in China. 


Now since the company is in a improving price scenario, they will be selling the lower priced inventory at higher prices in addition to the usual margins. 


All these factors will lead to improvement in sales and profitability.

Link to all my articles on BEPL:

APRIL 22, 2018—> Bhansali Engg(BEPL): Q4’2018 Result Analysis 

MAY 7, 2018—> What made me invest in Bhansali Engg Polymers?

JULY 16, 2018—> Bhansali Engineering Polymers (BEPL): Q1’FY19 Quarterly Result Analysis

NOVEMBER 1, 2018—> Bhansali Engineering Polymers (BEPL): Q2’FY19 Quarterly Result Analysis

JANUARY 24, 2019—>Learnings from my investment in Bhansali Engg Polymers(BEPL)!

FEBRUARY 19, 2019—> Bhansali Engg Polymers(BEPL) & Ineos Styrolution- Q3FY19 Result analysis

AUGUST 8, 2019: —>BEPL Vs Ineos Styrolution: Q1FY20 Analysis

APL Apollo Tubes Ltd: Q2FY21 Quarterly Result Analysis​​

Q2FY21 Quarterly Result Analysis

APL Apollo Tubes Ltd: Q2FY21 Quarterly Result Analysis​​

APL Apollo tubes also saw their top line grow almost 34% YoY and the margin improvement was even more impressive. Rural market drove growth


In the current quarter, the company moved to cash & carry model, thus reducing the debtor days to just 6 from earlier 25. Lowest debtor days in building material industry.


Market share increased to 50%. They are taking away market share from small organized and unorganized players. 

Monsoon is usually slow months for these companies. Despite that the demand has been quite good.

Now, moving more towards value added products.

Other similar improved performance can be seen for companies such as :

  1. Poly Medicure Ltd

  2. KPR Mills Ltd

  3. Indo Count Industries Ltd

  4. Welspun India Ltd

  5. Ester Industries Ltd

  6. Deepak Nitrite

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