Cummins, the automotive and industrial engine specialist posted a 50% growth in net profit for December ending third quarter of FY-23 led by the strong momentum in both domestic and international markets.
The company posted a net profit of Rs 479 crore for December ending third quarter of FY-23. The total sales grew 26% during the quarter to Rs 2144 crore.
Reviewing the Q3 performance, Ashwath Ram, MD, Cummins India Ltd said, the demand momentum continued across segments. With moderation in commodity costs, oil, and other industrial raw materials coupled with easing inflation, the buoyant tax collections economy continues to sustain growth momentum.
"For the quarter ended December 31, 2022, CIL reported record quarterly revenue driven by strong domestic and export revenue coupled with prudent cost management resulting in record quarterly profit. We continue to see supply chain challenges, especially for specific electronic and other components. With geopolitical risk and inflation likely to slow down developed markets, we remain cautiously optimistic about the short to medium-term demand outlook," said Ram.
CIL services a broad spectrum of the economy, and it witnessed continued demand from end markets like data centers, commercial real estate, rental, infrastructure, healthcare, and telecom, etc., during the quarter, besides, demand across industrial sectors like mining, railways, construction, etc., is holding up well, claimed the company.
On the way ahead, Ram said, the recent budget announced by the Government of India has a stronger outlay for the infrastructure sector, including railways, which is expected to create strong demand from various segments in the domestic market.
"India will reach a significant milestone in the Power Generation segment which will transition from CPCB II to CPCB IV+ emission norms effective July 1, 2023. The Central Pollution Control Board has allowed the sale of CPCB II generator sets till December 31, 2023, post which the Power Generation market will evolve based on the new emission norms," added Ram.
On the challenging going ahead, the company believes the geo-political and supply chain conditions will continue to be unpredictable and hence it did not provide any guidance for FY-24, but assured that the company is well-positioned to tackle any challenges with its strong financial position.