Cummins India jumped 7.39% to Rs 3,780 after the company’s standalone net profit increased 33% to 419.8 crore on 4.02% rise in revenue from operations to Rs 2,262.03 crore in Q1 FY25 over Q1 FY24.
Domestic sales jumped 12% YoY to Rs 1,873 crore while exports slipped 22% YoY to Rs 389 crore during the period under review.
Profit before tax stood at Rs 550.91 crore in first quarter of FY25, up 32.89% from Rs 414.56 crore posted in corresponding quarter previous fiscal.
Ashwath Ram, managing director of Cummins India, said, Indian economy continues to be resilient despite global geopolitical uncertainties impacting the business sentiment globally. Indian economic outlook continues to be positive; tax collections are indicating the strength of underlying business activities.
The latest Union budget emphasized the governments continued focus on infrastructure development and continued higher budgetary allocation for infrastructure, special projects for end-to-end connectivity for ports, coal, steel, and fertilizer sectors. At the same time, internationally, geopolitical risks and conflicts continue to pose uncertainty about global trade and supply chain disruptions.
For the quarter ending June 30, 2024, CIL domestic revenue was driven by strong domestic demand from all segments especially from the industrial sector. Powergen revenue was expectedly softer considering the sunsetting of CPCB II norms on June 30, 2024. Exports revenue grew 13% over the prior quarter due to an improvement in demand from the end markets.
On outlook front, the company stated, The investment in infrastructure (public and private) and broader economic growth continue to drive profitable growth for the company. For the Powergen sector, there is a complete switchover to CPCB IV+ emission norms-compliant products effective July 1, 2024. The company has a strong portfolio of CPCB IV+ emission norms-compliant products to meet customer demand across the entire product range. We remain cautiously optimistic about the demand outlook for the near term and optimistic about the long-term growth prospects.
Exports might see an impact in the near term due to global economic uncertainties. The company closely monitors the results of geopolitical events unfolding in different parts of the world and their impact on global demand and supply chains. Also, the company has a diversified portfolio of products and is striving for a recovery in exports.
Meanwhile, Ashwath Ram has resigned as managing director (MD), director and key managerial personnel of the company effective from close of business hours on 31 August 2024, as he will be assuming a full-time global role with Cummins Inc. USA.
Further, based on the recommendation of the nomination and remuneration committee, the board has approved the appointment of Shveta Arya as an additional director and MD (Designate) of the company with effect from 8 August 2024. Further, she will take over as whole-time MD of the company with effect from 1 September 2024 for a term of three consecutive years, subject to members approval.
Cummins India is a leading manufacturer of diesel and natural gas engines. The Company is engaged in the business of manufacturing trading and selling of engines and allied activities.
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First Published: Aug 07 2024 | 1:43 PM IST
