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During the September quarter, Elgi Equipment’s net profit grew to over Rs18 crore despite 10% fall in sales
Elgi Equipments Ltd reported an 8% growth in its second quarter net profit despite decline in sales.
For the quarter to end-September, the air compressors and automobile service station equipment maker, said, its net profit increased to Rs18.1 crore from Rs16.7 crore while total revenues, including sales, declined 10% to Rs183.1 crore from Rs204.3 crore, same period last year.
The bottom line was affected by weak domestic demand, a decline in automotive division and fluctuations in exchange rates. “Compressor business grew by 7.8% organically. Domestic market was stressed across all the sectors affected by the high fluctuations in the exchange rates combined with overall sluggish market conditions. Company’s performance in the international market significantly contributed to sustain the top line.
Automotive division registered a negative sales growth of 10% over the corresponding previous half year due to sluggishness in the market. Also workshop expansions by most car manufacturers have been deferred due to low sales,” Elgi Equipment said in a release.
During the quarter, the foreign institutional investors (FII) held 12.96% of the company’s outstanding shares when compared to 11.40% in same period last year, a 1.56 percentage points increase. Domestic institutional investors (DII) also increased their stake by 6.42 percentage points at 10.44% from 4.02% in same period last year. While, shareholdings of promoters remained same at 31.79%. Public shareholding decreased by 7.99 percentage points to 44.81% from 52.80% a year ago period.
Company said, “The economic scenario remains uncertain across geographies. However, emerging markets, having seen a sizeable slowdown in growth, indicate a semblance of recovery. The short term growth outlook remains challenging and modest at best.”
Elgi Equipments closed Tuesday 2.5% down at Rs82 on the BSE, while the 30-share benchmark ended 1% down at 20,282.
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