Results     31-May-24
Analysis
Cummins India
Net up 54% on good operating show
Consolidated net sales (including other operating income) of Cummins India for the quarter ended Mar 2024 has increased 19.92% to Rs 2319.02 crore.  Operating profit margin has jumped from 17.07% to 23.22%, leading to 63.13% rise in operating profit to Rs 538.51 crore.  Raw material cost as a % of total sales (net of stock adjustments) decreased from 58.08% to 52.26%.   Purchase of finished goods cost rose from 10.36% to 11.84%.   Employee cost increased from 7.92% to 8.33%.   Other expenses fell from 7.41% to 4.44%.   

Other income rose 14.24% to Rs 99.9 crore.  PBIDT rose 52.89% to Rs 638.41 crore.  Provision for interest fell 5.41% to Rs 6.3 crore.  Loan funds declined from Rs 376.09 crore as of 31 March 2023 to Rs 126.98 crore as of 31 March 2024.  Inventories rose to Rs 949.65 crore as of 31 March 2024 from Rs 903.66 crore as of 31 March 2023.  Sundry debtors were higher at Rs 2,085.35 crore as of 31 March 2024 compared to Rs 1,597.12 crore as of 31 March 2023.  Cash and bank balance rose to Rs 1,512.78 crore as of 31 March 2024 from Rs 1,386.23 crore as of 31 March 2023.  Investments rose to Rs 1,641.50 crore as of 31 March 2024 from Rs 1,457.44 crore as of 31 March 2023 .  

PBDT rose 53.84% to Rs 632.11 crore.  Provision for depreciation rose 12.68% to Rs 42.38 crore.  Fixed assets increased to Rs 2,267.41 crore as of 31 March 2024 from Rs 2,229.30 crore as of 31 March 2023.  Intangible assets increased from Rs 37.80 crore to Rs 131.84 crore.  

Profit before tax grew 57.98% to Rs 589.73 crore.  Share of profit/loss was 21.68% higher at Rs 86.53 crore.  Provision for tax was expense of Rs 137.4 crore, compared to Rs 95.49 crore.  Effective tax rate was 20.32% compared to 21.49%.

Minority interest was nil in both the periods.  Net profit attributable to owners of the company increased 54.44% to Rs 538.86 crore.  

Sales of Engine Business segment has gone up 19.73% to Rs 2,271.88 crore (accounting for 78.64% of total sales).  Sales of Lubes segment has gone up 6.27% to Rs 617.09 crore (accounting for 21.36% of total sales).  

Profit before interest, tax and other unallocable items (PBIT) has jumped 52.06% to Rs 731.23 crore.  PBIT of Engine Business segment rose 52.46% to Rs 644.23 crore (accounting for 88.10% of total PBIT).  PBIT of Lubes segment rose 49.20% to Rs 87.00 crore (accounting for 11.90% of total PBIT).  

PBIT margin of Engine Business segment rose from 22.27% to 28.36%.  PBIT margin of Lubes segment rose from 10.04% to 14.10%.  Overall PBIT margin rose from 19.40% to 25.31%.  

Full year results analysis.


Net sales (including other operating income) of Cummins India has increased 15.80% to Rs 9000.2 crore.  Sales of Engine Business segment has gone up 15.95% to Rs 8,859.99 crore (accounting for 79.71% of total sales).  Sales of Lubes segment has gone up 4.93% to Rs 2,254.71 crore (accounting for 20.29% of total sales).  

Profit before interest, tax and other unallocable items (PBIT) has jumped 37.07% to Rs 2,361.70 crore.  PBIT of Engine Business segment rose 39.58% to Rs 2,112.10 crore (accounting for 89.43% of total PBIT).  PBIT of Lubes segment rose 18.91% to Rs 249.60 crore (accounting for 10.57% of total PBIT).  

PBIT margin of Engine Business segment rose from 19.80% to 23.84%.  PBIT margin of Lubes segment rose from 9.77% to 11.07%.  Overall PBIT margin rose from 17.60% to 21.25%.  

Operating profit margin has jumped from 16.05% to 19.66%, leading to 41.83% rise in operating profit to Rs 1,769.66 crore.  Raw material cost as a % of total sales (net of stock adjustments) decreased from 57.83% to 53.59%.   Purchase of finished goods cost rose from 9.89% to 10.46%.   Employee cost increased from 8.21% to 8.92%.   Other expenses fell from 8.27% to 7.33%.   

Other income rose 22.69% to Rs 378.07 crore.  PBIDT rose 38.04% to Rs 2147.73 crore.  Provision for interest rose 68.72% to Rs 27.4 crore.  Loan funds declined from Rs 376.09 crore as of 31 March 2023 to Rs 126.98 crore as of 31 March 2024.  Inventories rose to Rs 949.65 crore as of 31 March 2024 from Rs 903.66 crore as of 31 March 2023.  Sundry debtors were higher at Rs 2,085.35 crore as of 31 March 2024 compared to Rs 1,597.12 crore as of 31 March 2023.  Cash and bank balance rose to Rs 1,512.78 crore as of 31 March 2024 from Rs 1,386.23 crore as of 31 March 2023.  Investments rose to Rs 1,641.50 crore as of 31 March 2024 from Rs 1,457.44 crore as of 31 March 2023 .  

PBDT rose 37.72% to Rs 2120.33 crore.  Provision for depreciation rose 12.07% to Rs 159.18 crore.  Fixed assets increased to Rs 2,267.41 crore as of 31 March 2024 from Rs 2,229.30 crore as of 31 March 2023.  Intangible assets increased from Rs 37.80 crore to Rs 131.84 crore.  

Profit before tax grew 40.32% to Rs 1,961.15 crore.  Share of profit/loss was 17.88% higher at Rs 245.16 crore.  Extraordinary items were increased to Rs -1.70 crore.  Provision for tax was expense of Rs 484.03 crore, compared to Rs 363.14 crore.  Effective tax rate was 21.96% compared to 22.82%.

Minority interest was nil in both the periods.  Net profit attributable to owners of the company increased 40.10% to Rs 1,720.58 crore.  

Future Outlook: 

The investment in infrastructure (Public and Private) and broader economic growth continue to drive profitable growth for the company. Concerning the Powergen Market, CPCBII products can be sold until June 30, 2024. Consequentially, the market will see a demand shift to CPCB IV+ emission norms-compliant products effective July 1, 2024. The company has a strong portfolio of CPCB IV+ emission norms-compliant products to meet customer demand across the entire product range.

Exports might see an impact in the near term due to global economic uncertainties. The company closely monitors the results of geopolitical events unfolding in different parts of the world and their impact on global demand and supply chains. Also, the company has a diversified portfolio of products and is striving for a recovery in exports. The company has a trusted brand, incredible product range, access to cutting-edge technology, valued stakeholder relationships, world-class manufacturing capabilities, best-inclass talent, and a customer-centric service organization with an extensive distribution and service network throughout the country and neighboring regions. 


Others

Equity capital stood at Rs 55.44 crore as of 31 March 2024 to Rs 55.44 crore as of 31 March 2023.  Per share face Value remained same at Rs 2.00.  

The Board has approved and recommended to members for their consideration and approval a Final Dividend of Rs. 20/- (1000%) per equity shares on 277,200,000 fully paid-up equity shares (Face Value Rs. 2/- each) for the Financial Year 2023-24 in addition to the interim dividend of Rs. 18/- per share declared on February 07, 2024. The Final Dividend, as may be approved by the members at the ensuing Annual General Meeting, will be paid on or around August 30, 2024.

Promoters’ stake was 51.00% as of 31 March 2024 ,compared to 51.00% as of 31 March 2023 .  



Management Comments :
Ashwath Ram, Managing Director, Cummins India Limited, said: Indian economy continues to remain resilient despite geopolitical events and other economic events impacting the growth of various countries. Key economic indicators like GDP growth rate of 7.6% and consistent PMI indicate optimism about continued growth. Robust tax collections are indicating underlying growth in economic activities. Indian Government’s continued focus on infrastructure and higher allocation in the interim budget is driving growth in end markets of interest for the company. At the same time, internationally, geopolitical risks and conflicts continue to pose uncertainty about global trade and supply chain disruptions. The company recorded another year of record revenue and profit, driven by strong demand from the domestic market while export market demand was soft. The Company launched the CPCB IV+ range of products, which were very well received by customers. The company continues to have a strong balance sheet and liquidity and is well-positioned to support its operations and growth plans. 

Cummins India : Consolidated Results
 Quarter endedYear ended
Particulars202403202303Var.(%)202403202303Var.(%)
Net Sales (including other operating income)2,319.021,933.8519.929,000.207,772.0915.80
OPM (%)23.2217.07615 bps19.6616.05361 bps
OP538.51330.1163.131,769.661,247.7441.83
Other Inc.99.9087.4514.24378.07308.1522.69
PBIDT638.41417.5652.892,147.731,555.8938.04
Interest6.306.66-5.4127.4016.2468.72
PBDT632.11410.9053.842,120.331,539.6537.72
Depreciation42.3837.6112.68159.18142.0412.07
PBT589.73373.2957.981961.151397.6140.32
Share of Profit/(Loss) from Associates86.5371.1121.68245.16207.9817.88
PBT before EO676.26444.452.172206.311605.5937.41
EO Income00--1.7-14.388.11
PBT after EO676.26444.452.172204.611591.2938.54
Taxation137.495.4943.89484.03363.1433.29
PAT538.86348.9154.441720.581228.1540.10
Minority Interest (MI)00-00-
Net profit538.86348.9154.441720.581228.1540.10
P/(L) from discontinued operations net of tax00-00-
Net profit after discontinued operations538.86348.9154.441720.581228.1540.10
EPS (Rs)*19.4412.5954.4462.1244.6939.01
* EPS is on current equity of Rs 55.44 crore, Face value of Rs 2, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database


Cummins India : Consolidated Segment Results
 Quarter endedYear ended
% of (Total)202403202303Var.(%)% of (Total)202403202303Var.(%)
Sales
Engine Business78.642,271.881,897.4519.7379.718,859.997,641.4015.95
Others0.000.000.00-
Intragroup0.000.000.00-
Lubes21.36617.09580.676.2720.292,254.712,148.844.93
Total Reported Sales100.002,888.972,478.1216.58100.0011,114.709,790.2413.53
Less: Inter segment revenues 0.000.00- 0.000.00-
Net Sales100.002,888.972,478.1216.58100.0011,114.709,790.2413.53
PBIT
Engine Business88.10644.23422.5652.4689.432,112.101,513.1439.58
Others0.000.000.00-
Intragroup0.000.000.00-
Lubes11.9087.0058.3149.2010.57249.60209.9018.91
Total PBIT100.00731.23480.8752.06100.002,361.701,723.0437.07
Less : Interest0.000.00-0.000.00-
Add: Other un-allcoable-54.97-36.47-50.73-157.09-131.75-19.23
PBIT Margin(%)
Engine Business 28.3622.27608.68 23.8419.80403.68
Others 0.000.000.00
Intragroup 0.000.000.00
Lubes 14.1010.04405.66 11.079.77130.21
PBT100.00676.26444.4052.17100.002,204.611,591.2938.54
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