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Informist, Thursday, Aug 8, 2024

--ABB India to pay 10.66 rupees/share interim dividend

--ABB India Apr-Jun revenue 28.31 bln rupees vs 25.09 bln

--ABB India Apr-Jun net profit 4.43 bln rupees vs 2.96 bln

--Analysts saw ABB India Apr-Jun net profit 4.35 bln rupees

--ABB India Apr-Jun net profit 4.43 bln rupees

By Avishek Rakshit

KOLKATA – Strong order execution and an all-round steady business performance across verticals helped ABB India Ltd report a 50% year-on-year jump in its net profit to 4.4 bln rupees for Apr-Jun. The revenue jumped by 12.8% year-on-year at 28.3 bln rupees.

The company slightly beat the Street's net profit projection by 80 mln rupees, but trailed in terms of revenue which was seen at 31.1 bln rupees.

In Apr-Jun, total expenditure, including finance cost, was at 23.24 bln rupees, compared with 21.91 bln rupees a year ago. Finance cost surged threefold on year to 45.1 mln rupees. The company's tax outgo for the June quarter was at 1.51 bln rupees, against 972.5 mln rupees a year ago.

The operating EBITA for the quarter was 5.6 bln rupees, up by 64% year-on-year, mainly driven by good revenue mix and better margin orders. Positive price movement, cost optimisation, steady material and commodity prices and a favourable currency exchange gain impact were some other catalysts for growth.

Total orders for the quarter were 34.4 bln rupees, and long cycle orders from emerging sectors like data centers, renewable energy, electronics, metro and railways; as well as core industry segments contributed to the growth, the company said in a statement. Most business verticals posted a significant double-digit growth in orders. Process automation had good traction in service orders which partially offset the impact of one-time large metal segment order received during Apr-Mar period of 2023. The company treats calendar year as its financial year.  

Detailing on the business performance of its verticals, ABB India said that along with power distribution solutions for a large data center, transportation, mobility, and automotive segments were key revenue contributors.

Transportation business included traction technology orders from the railways and metro, and automotive primarily constituted robotics solutions for the electric vehicle segment. While minerals and mining seem to consolidate, metals provided traction to order inflows. There was also good demand for power distribution equipment from metros in two cities, a metals company, and a solar project in Gujarat.

Export and services orders enhanced growth with precision equipment export order for a specialised chemical engineering, procurement, construction order and service order for gas insulated switchgears from energy majors for the quarter. Terminal automation system and blending solutions for energy majors also provided significant business opportunity during the quarter, the company said.

"We continue to focus on diversifying our offerings across the market segments and making strategic investments to capitalise on market opportunities," said Sanjeev Sharma, managing director of ABB India, in a statement.

The electrification business vertical continued seamless execution with a solid backlog across divisions, and the motion vertical had higher revenue for propulsion products and high dynamic performance motors, the company said. The process automation division had higher service revenue from the energy sector. Robotics and discrete automation business had greater automotive orders.

While revenue from domestic demand continued to maintain its share as in the earlier periods, the company continued to focus on optimising value chain, timely deliveries with adequate capacities to fulfil market demand.

In its business outlook, ABB India said that it is well poised to leverage the projected strong domestic growth in the market with relatively stabilising commodity prices, robust public investment and resilient private consumption.

The board of directors of ABB India today recommended an interim dividend of 10.66 rupees a share.

The board also approved a proposal to secure on lease approximately 6.41 acres of industrial land with a warm shell factory, offices, and other infrastructure in Bengaluru, in line with the company's overall growth and investment strategy.

Additionally, the board granted in-principle approval for an investment of up to 850 mln rupees to expand the company's operations in process automation and the electrification business, the company said in a separate statement.

Today, shares of ABB India closed 0.9% higher at 7,942.30 rupees on the National Stock Exchange. End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Deepshikha Bhardwaj

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