Motherson Sumi Q3 profit rises 1.8% to Rs 254 cr, OPM falls

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Moneycontrol Bureau

Motherson Sumi Systems' (MSSL) third quarter profit increased 1.8 percent year-on-year to Rs 254 crore on consolidated basis, impacted by higher expenses.

It was a mixed set of earnings from the auto component manufacturer. Profit was expected at Rs 265 crore on revenue of Rs 8,679 crore for the quarter, according to a CNBC-TV18 poll.

Consolidated total income grew 14.5 percent to Rs 9,149 crore during October-December quarter from Rs 7,989 crore in same quarter last fiscal. Domestic business jumped 15.3 percent to Rs 1,322.2 crore and exports increased 13 percent to Rs 7,627.6 crore during the quarter.

"The strong revenue growth, improved operational performance coupled with prudent financial management has resulted in the company consistently outperforming the market," said VC Sehgal, chairman, MSSL.

As the global markets are also picking up, he expects the company to keep on delivering exceptional performance.

Operating profit increased 4.5 percent year-on-year to Rs 829 crore but margin dropped 80 basis points to 9.1 percent in December quarter due to fall in standalone margin. Analysts had estimated operating profit at Rs 830 crore and margin at 9.5 percent for the quarter.

Total expenses of the company climbed 16.9 percent to Rs 8,663.9 crore (on yearly basis) due to higher other expenses and employee & raw material costs.

On standalone basis, profit declined 8 percent year-on-year to Rs 114 crore but revenue increased 12.2 percent to Rs 1,219 crore during October-December quarter. Operating profit rose 2.3 percent to Rs 225 crore but margin dropped 190 basis points to 18.4 percent during the same period.

Motherson Sumi says in euro terms, Samvardhana Motherson Reflectec (SMR) revenue grew 13 percent and Samvardhana Motherson Peguform (SMP) revenue rose 19 percent on yearly basis.

In rupee terms, SMR's revenue increased 4.5 percent year-on-year to Rs 2,508 crore with operating profit rising 5.8 percent and margin growth of 10 basis points. SMP reported a 9.6 percent growth in revenue at Rs 4,487 crore with operating profit climbing 28 percent and margin 100 basis points.

Balance sheet has improved in Q3 as consolidated debt reduced 8 percent sequentially to Rs 4,711 crore.

Motherson says it successfully closed the deal for purchase of assets of Scherer & Trier group (S&T) during the quarter, adding the current turnover of S&T is in the range of euro 240 million.

This is the third acquisition by MSSL this year. It further consolidated MSSL’s polymer business in Europe and North America.

"Progress of 14 new facilities is on schedule, 3 facilities completed and under start up," says the company.

At 12:50 hours IST, the scrip of Motherson Sumi Systems was quoting at Rs 451.85, up Rs 14.30, or 3.27 percent on the BSE.