Diesel and natural gas engines manufacturer Cummins India's July-September quarter profit is likely to increase 1.8 percent year-on-year to Rs 206 crore due to lower other income, according to analysts polled by CNBC-TV18. In year-ago period, other income was led by very high dividend income. Earnings will be announced on November 5.
Revenue is seen rising 13 percent to Rs 1,296 crore from Rs 1,144 crore during same period.
Analysts see some traction in domestics business as growth in power gensets may be due to continued power cuts in South India and price cuts may aid to regain market share. They also see traction in industrial business.
Operating profit during the quarter is expected to grow 11.4 percent to Rs 212 crore but margin may contract 30 basis points to 16.3 percent compared to same quarter last fiscal. Margin may get impacted by increased import content in CPCB (Central Pollution Control Board) II compliant engines, price cut or price roll back and increase in competitive intensity in domestic market.
Key factors to watch out for would be exports and volume growth (given low capacity utilisation levels of 55-60 percent). The company in August raised its annual guidance of exports to 10-15 percent growth against 0-5 percent earlier on the back of higher genset demand due to power deficit in Africa region, higher outsourcing from India and some pre-buying in Nigeria due to increase in import duties.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
