Sharp India – Q1 FY15 Results Update

Sharp India came out with a stellar turnaround performance for the Q1-FY15. The revenue rose 172% YoY to 79.6cr and profits were at 3.38cr vs a loss of 1.69cr YoY. The company has started generating profits consistently, in the last three quarters. This is good news for the investors. QoQ wise, profits declined (optically) to 3.38cr from 7.5cr, but revenues increased 14.4% from 69.4cr to 79.7 cr. On the face of it, profits seems to be declining QoQ, but if we dig further, then we’ll realize that last quarter’s number had 8.3cr (this is a huge number as it improves operating profit quite sharply) that Sharp India received from Sharp Business Systems as the way of price support. These numbers enhance the operating profits dramatically, and now if you consider that this quarter there has been no such thing from sharp business systems, then this quarter’s numbers have been far better than Mar 14 quarter (both revenue wise and more importantly operating profit wise). Clearly, people were expecting magic and the magic has been actually delivered, but people do not realize this as investors are not interested in digging deeper and are being swayed by mass hysteria. Segment Wise breakup:











Clearly, the factory has lot more scope to manufacture and therefore, a lot more scope for revenue expansion. Will it happen overnight, or would they start exporting immediately is anybody’s guess.

Remember smart investors use their own analysis and logic to make money and do not let  mass hysteria to dictate their investment decisions. Readers of this blog have already multiplied their money. People should not get disheartened, by 20-25% correction. Its good for long term investors if the speculators are moving out.  Anyways, IMHO, these are great turnaround numbers.

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12 Responses to Sharp India – Q1 FY15 Results Update

  1. Dilip says:

    But sir in sharp india next qtr will be less profit due to no season of ACs.

    • Everybody (especially bigger investors) knows that for ACs the peak season is Q1 and Q4 of a FY. Now coming to the profit figure, ideally it should be below Q1 and Q4 but we do cannot know, why, because what if in the next quarter there is again some price support received from Sharp Business Systems? Then the profits could zoom. Anyways, I am not counting on it, but I know that profits could be down next quarter. This is a known fact and should not scare investors. Kudos to sharp management to bring around this turnaround in their operations that investors are taking for granted that there would be profits coming every quarter. Do you know last year Q2 had a loss of over 3cr. This time there should be good profits, even if it lesser than Q1 (due to seasonality of business) still a positive bottomline would be a great thing. Moreover, as I have said repeatedly, the trigger in sharp india are many, like they have said that they could make india a manufacturing hub for other countries too. But we do not know when that would happen. Do not expect the stock price to go up only. There would always be period of consolidation. One should try to research the stock and if you feel convinced only then invest.

  2. RAKESH KHANNA says:

    dear aceinvestor from where you got the production figures for ac’s and TV’s for march and june quarter moreover is this right time to invest at 56 rs

  3. DM says:

    Good time for fresh buy for long term? Or wait till Jan as winter season AC sales would be slow. Would appreciate if you would suggest a buy range.

    This Japanese company could be a big player in a couple of years. Moreover India-Japan relationship and falling Yen would help.

  4. DM says:

    Hi Ace,

    Any pick you like from logistics sector which can be held for long term? Tracking Gati and TCI but they are way above their buying price.

    Also appreciate the time you take to reply to each post of your followers *respect*

    Hope to disturb you again and again with my queries 🙂

  5. DM says:

    Hello Ace,

    Could you share your view on Samtex Fashions and Galaxy Entertainment.

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