India's Greaves Cotton on November 7 reported a second-quarter loss, hurt by a one-time charge relating to a government incentive for electric scooter sales and higher expenses.
The company posted a consolidated loss of 1.91 billion rupees ($22.9 million) for the quarter ended Sept. 30, compared to a profit 288.8 million rupees last year.
Greaves had in May received a notice from the Indian government which alleged its electric vehicle unit failed to adhere to guidelines of an e-scooter incentive scheme, and directed that it return the subsidies claimed.
Separately, the government in May slashed e-scooter cash incentives without explanation, saying it would pay just up to 15% of the price before taxes, compared to 40% earlier.
Greaves, which also makes engines and powertrains, reported a subsidy-related provision of 4.77 billion rupees. Its overall one-time charge stood at 3.81 billion rupees, mainly due to a gain from selling land.
The company had reported a loss of 50.8 million rupees in the previous quarter as well, as sales of its "Ampere" branded electric scooters took a beating after the subsidy cut.
Quarterly expenses were up 4.5%, outpacing a 4% growth in revenue. While revenue at its biggest segment engines rose 20%, its electric mobility segment reported a 37% drop.
Shares closed flat and are down 12.3% since its unit received the government notice proposing that it be de-registered from the incentive scheme.
($1 = 83.2458 Indian rupees)
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