ABB India surges over 10% on strong order growth in Q1

The stock rallied 10.6% to Rs 1,550, also its 52-week high on BSE in early morning trade.

Shares of ABB India rallied 10.6% to Rs 1,550, also its 52-week high on BSE in early morning trade after the company said it has posted a significant year-on-year (y-o-y) increase in orders booked in the first quarter of 2017 (Q1), driven by government initiatives and investments.

The orders received for the January-March quarter was Rs 2,342 crore, a 28% higher as compared to Rs 1,830 crore orders received in the same quarter last year. In first quarter of 2016, the company had reported 1.4% y-o-y drop in orders booked.

An order backlog of Rs 12,023 crore, as on March 31, 2017, provides solid visibility for future revenue, ABB India said in a press release.

In continuation of the focus on 24x7 reliable Power to All, state utilities digitalized parts of their networks and upgraded systems extending to various remote locations. Value led engagement and knowledge sessions with key customers will drive the shift to the fourth industrial revolutions as witnessed to some extent in orders for food and beverage as well as automotive sectors, it added.

The company said, the traction in the transportation sector led by railways also helped retain the order momentum in this quarter. Notwithstanding an uncertain global market, sustained engagement in export markets have resulted in major order uptrend. Intensive focus on installed base with value offerings also contributed to robust growth in service orders in the first quarter.

Meanwhile, during the quarter under review ABB India has reported 3.5% y-o-y growth in net profit at Rs 88 crore in Q1, on back of 8% rise in revenues of Rs 2,169 crore over the previous year quarter.

Customizable offerings, continued focus on cash and cost, differentiated portfolio that match India’s vision of growth with digital technologies have supported y-o-y improvement in the net working capital position, it added.

At 09:48 am; the stock was up 9.5% at Rs 1,535 on BSE as compared to 0.03% decline in the S&P BSE Sensex. The trading volumes on the counter jumped multiple-fold with a combined 352,375 shares changed hands on the BSE and NSE so far.