Shares of Cummins India rose as much as 6% on May 29 after the company posted its March quarter results. To top it up, the management’s positive comments, highlighting better growth ahead also helped lift sentiment for the stock.
Cummins India shares edged higher despite a dip in quarterly profit, as steady exports and upbeat management commentary kept sentiment buoyant
Shares of Cummins India rose as much as 6% on May 29 after the company posted its March quarter results. To top it up, the management’s positive comments, highlighting better growth ahead also helped lift sentiment for the stock.
While net profit for the quarter declined 7.2% year-on-year to Rs 521.37 crore, investors appeared encouraged by a rise in operational revenue and robust export performance. In the same quarter last year, the company had reported a profit of Rs 561.52 crore on revenue of Rs 2,316.15 crore.
Revenue from operations increased 6.1% year-on-year to Rs 2,457 crore, buoyed by a steady uptick in export demand. However, operating performance was somewhat muted. EBITDA fell 4.5% to Rs 519.9 crore, and margins narrowed to 21.16% from 23.5% a year earlier.
Despite the softer quarterly performance, Cummins India ended the financial year on a solid footing. For FY25, standalone sales rose 15% year-on-year to Rs 10,166 crore. Domestic sales grew 18% to Rs 8,395 crore, while exports increased 6% to Rs 1,771 crore.
In the March quarter, total sales reached Rs 2,414 crore, up 6% year-on-year but down 21% sequentially. Domestic sales held steady at Rs 1,935 crore compared to the same period last year, while exports surged 39% to Rs 479 crore.
Investors appeared to focus on the company’s full-year growth trajectory and export momentum, helping lift the stock despite a tepid quarter.
During the earnings call, Cummins India management also indicated that they aim to sustain gross margins through FY26 despite ongoing cost pressures. They management also revealed witnessing strong interest and ordering activity from data centres across India, which is emerging as a key demand driver. Additionally, the company highlighted rising volumes for its CPCB IV+ compliant products, expecting these to overtake CPCB II product volumes within the next two quarters.
Meanwhile, trading volumes in the counter also recorded a sharp uptick. As many as 19 lakh shares changed hands on the exchanges thus far, already exceeding the one-month daily traded average of six lakh shares.