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Samvardhana Motherson reports Q1 results; rise in profit, loss in share price
Industry News- Aug 14,24
Following the results, Samvardhana Motherson's shares fell by as much as 4.5%, closing 2.8% lower at Rs 182.9. Despite this decline, the stock has gained 70% in 2024.
The company reported a 65.4% increase in net profit to Rs 9.94 billion, aligning with the anticipated Rs 9.85 billion. This boost in profitability was attributed to scale benefits and margin-enhancing mergers and acquisitions (M&As).
Revenue for the quarter rose by 28.5% year-over-year to Rs 288.68 billion, exceeding the estimated Rs 284.6 billion. This revenue growth occurred despite muted industry expansion and changes in platform mix, as noted in the investor presentation.
Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) increased by 44% year-on-year to Rs 27.75 billion , though it fell short of the expected Rs 28.30 billion . The EBITDA margin improved by 100 basis points to 9.6% from 8.6% last year but was below the anticipated 10%.
The company's gross debt at the end of the June quarter reached Rs 201.14 billion , up from Rs 173.51 billion in March and Rs 125.46 billion a year earlier. Net debt also increased to Rs 13,370 billion from Rs 103.72 billion in March and Rs 83.11 billion last year.
The rise in debt by Rs 17.50 billion was primarily due to M&A closures during the quarter and increased working capital needs, driven by the Red Sea crisis and fluctuations in customer production schedules. The company expects these issues to normalise by the September quarter.
Following the results, Samvardhana Motherson's shares fell by as much as 4.5%, closing 2.8% lower at Rs 182.9. Despite this decline, the stock has gained 70% in 2024.
(CNBCTV18)
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