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Below is quote on Suprajit Engineering Results by Mr. Yash Gupta, Equity Research Associate, Angel Broking Ltd   

Suprajit Engineering posted a decent set of results for Q1FY22 despite several challenges. The top-line declined by 30% QoQ to Rs 362 Crs mainly on account of 36% QoQ decline in Automotive Cable Division and due to ~40% QoQ decline in Phoenix Lamps Division. Lockdowns in the initial part of the quarter and continued supply chain related issues have likely impacted the top-line while diversion of oxygen from the halogen plant impacted Lamps Division. Non-automotive Division (SENA) was flattish on QoQ basis with Wescon posting highest Q1 sales in its history. EBITDA Margin declined 232bps QoQ to 13.6% on account of decline in top-line. Gross margins were up 338bps QoQ while 448bps QoQ increase in Employee cost and 121bps QoQ increase in other expenses impacted the overall EBITDA margins. Auto Cable division margins were flattish sequentially while 740bps QoQ/520bps QoQ decline in Phoenix Lamps Division /SENA Division margins dragged down overall EBITDA Margins. Aided by exceptional gains of Rs 16 Crs on account of PPP loan being forgiven by the US Fed Gov. (to Wescon), PAT decline by 25% QoQ to Rs 43 Cr. We expect the overall 2W industry to rebound in the 2HFY22 and believe that the upcoming auto season will be the key monitorable for the company.

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