More Stories

Informist, Sunday, Aug. 2, 2026

By Rajesh Gajra

MUMBAI - Intensifying competition in the power generation business segment, subdued demand in the industrial business segment, and falling exports are expected to weigh on the June quarter top line of Cummins India Ltd. The bottom line of the capital goods company is seen getting adversely affected by the war in West Asia with the impact on input costs arising from uncertain global supply chain dynamics, raw material availability, and changing tariff structures.

In its exports business, which had contributed 15% to the company's total sales for the March quarter, Cummins India had indicated recently that volatility in demand due to the current global supply chain disruption will weigh on the segment. The company had also said it was experiencing strong competitive activity in export markets, particularly in the power generation and global automotive sub-segments.

Cummins India is expected to report a net profit of INR 6.07 billion, up 11% on year, on the back of an expected revenue growth of 10% to INR 32.11 billion, according to the average of estimates from 11 brokerages. Among the net profit estimates, the highest is INR 6.35 billion from IDBI Capital Market Services Ltd. and the lowest is INR 5.77 billion from Nomura Equity Research. Sequentially, the net profit is seen down 1.7%.

On revenues, the highest estimate of INR 33.21 billion is from brokerage PhillipCapital (India) Pvt. Ltd. and the lowest is INR 29.92 billion from JM Financial Institutional Securities Ltd. Sequentially, the revenue is seen up 6.4%. The earnings before interest, tax, depreciation, and amortisation of the company for the reporting quarter are expected to be INR 6.67 billion, according to the average of estimates from 10 brokerages.

If the earnings estimate for Cummins India for the June quarter comes out right, the expected net profit growth of 11% on year will be lower than the reported net profit growth of 25% in the March quarter and 40% in the year-ago quarter. The expected net profit growth is also lower than the 33-59% net profit growth reported in the June quarters of the last three financial years--2025-26 (Apr-Mar), FY25, and FY24.

Kotak Securities Ltd. expects the June quarter revenue of Cummins India to be up only around 8% on year on weak exports to the West Asia region. A potential market share loss to Kirloskar Oil Engines Ltd. and weak industrial segment revenues are also cited by Kotak as factors expected to weigh down on the company's top-line growth for the quarter.

There are mixed views on the revenue growth in Cummins India's domestic power generation segment. While Kotak expects it to grow 8% on year, Nomura expects 15% growth. The revenues from the company's domestic power generation segment were 40% of total revenue in FY26.

On the company's domestic distribution and industrial segments, brokerages expect revenues to increase but none of them provided estimates. According to brokerage PhillipCapital, the industrial segment "which saw flattish growth in Q4 (Jan-Mar) can see some recovery on improved industrial activity in Q1 (Apr-Jun) due to rail and mining." The brokerage also expected the distribution business segment to report steady revenues "driven by high strong aftermarket". The domestic distribution business segment had contributed 27% of total revenues in FY26 while the domestic industrial segment had a 14% revenue share.

Cummins India's exports are seen getting hit during the June quarter. Kotak Securities expects weak export sales growth to chip 200 basis points off the total revenue growth of the company for the quarter. The brokerage expects a decline of more than 10% in export sales of the company for the June quarter. Exports contributed 17% of the company's sales for FY26.

The weak expected growth of Cummins India's net profit is primarily on account of an expectation of a decline in profitability. There is a consensus among brokerages on a contraction in the EBITDA margin of Cummins India in the June quarter. PhillipCapital sees the EBITDA margin declining by 80 basis points on year to 20.6%. Kotak Securities expects a decline of 63 bps. Nomura sees a 153 bp contraction.

The EBITDA margin of Cummins India is expected to contract in the June quarter "primarily on account of lower gross margin due to elevated commodity prices", according to Nomura. Raw material price inflation and rising competitive intensity in the power generation business are expected to drag the EBITDA margin down, according to Kotak Securities.

The company will detail its June quarter earnings Wednesday. After the earnings are released, investors will watch out for the management's commentary on demand sustainability, ramping up of orders from data centres, price hikes, and trends in exports, according to Motilal Oswal Financial Services Ltd. Brokerage Nomura said management updates on battery energy storage systems and margin trajectory will be key factors to watch out for, apart from the demand outlook and competitive intensity in data centres.

Friday, shares of Cummins India closed at INR 5,519 on the National Stock Exchange, down 8.4% from the closing price on the day the company released its March quarter earnings. Of the 10 brokerage reports on the company available with Informist, five have a "buy" call on the stock with an average target price of INR 6,007 while three have a "sell" call at an average target price of 4,660 and two recommend a "hold".

Following are the June quarter earnings estimates for Cummins India from 11 broking firms in INR billion, in descending order of the estimate of net profit:

End

Edited by Himanshi Gupta

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2026. All rights reserved.