Cummins spurts after Q3 PAT jumps over 20% YoY

Cummins India jumped 5.53% to Rs 672.50 after the company's consolidated net profit jumped 20.2% to Rs 240.10 crore on a 1.7% fall in net sales to Rs 1406.66 crore in Q3 FY21 over Q3 FY20.

Profit before tax in Q3 December 2020 stood at Rs 309.72 crore, up by 20% from Rs 258.05 crore in Q3 December 2019. Current tax expenses during the quarter increased by 36.8% year-on-year (YoY) to Rs 67.16 crore.

Ashwath Ram, managing director, Cummins India, said: On the back of economic recovery from the impact of COVID, some of our key segments reported strong recovery. That coupled with near normal operations enabled us to deliver strong Q3 results. Our domestic business continues to report strong sequential growth (in Q3 up 38%). Our Q3 revenue is up to 97% of last year's revenue for the same period.

This was led by recovery in construction, power generation and mining segments. We are encouraged by the economic rebound, however, we continue to watch our end markets closely. We believe that while few segments have recovered, there are still some segments which are yet to recover. We believe full economic recovery is still a work in progress and likely to take at least a few more quarters.

Export business is holding on and is slightly better than same period last year but declined sequentially due to soft end market demand. As the pandemic continues and new strains of virus emerge, we are closely watching our end markets to determine their impact on current and future quarters.

With respect to future outlook, the company said that it expects gradual recovery of demand in upcoming quarters. With market conditions continue to remain uncertain and visibility for end market recovery still somewhat limited, the company is not providing a full year revenue guidance for FY 2021.

Cummins India, part of the Cummins Group, is the country's leading manufacturer of diesel and natural gas engines for power generation, industrial and automotive markets. The company has a country-wide network of 20 dealerships with over 450 service points that provides products, services and after-market solutions for uptime of Cummins equipment and engines to customers in India, Nepal and Bhutan.

Powered by Capital Market - Live News