Shares of engine and power generator manufacturer Cummins India are sharply higher by over 5 percent on August 8, after the management indicated in the post-earnings investor concall that it is 'cautiously optimistic' about its exports business, and sees double-digit growth this fiscal.
The June quarter profit soared by 30.5 percent on year at Rs 604 crore with revenue growth of 25.7 percent at Rs 2,859 crore, backed by strong demand for engines and power generators. The export sales soared by 34 percent on year to Rs 523 crore.
Sale of engines and power generators account for a majority of Cummins India's revenue. The management said the revenue growth was backed by 'steady demand' across markets, and 'better execution' of orders.
However, Cummins India said there is uncertainty around the full impact of global trade issues on the economy, yet, it is optimistic about the India business.
"We believe that despite this uncertainty, we see continued opportunity as India’s economy remains stable due to government’s infrastructure push and recent reductions in interest rates to support economic growth given the low inflation environment," Shveta Arya, Managing Director, Cummins India said.
The management also said it has reached volumes last seen before Central Pollution Control Board (CPCB) IV+ mandated emission standards for diesel gensets were put in place. The momentum in the powergen business looks 'sustainable' going forward, it added.
Cummins India added that it remains 'cautiously optimistic about maintaining momentum across both domestic and international markets' and is closely tracking policy developments in India and abroad. "The company continues to work on operational efficiencies through cost management and maintains its focus on customer centricity, best in class talent, and its shareholders at large," Cummins India said in a statement.
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