Siemens India Q2 Results: Profit Nearly Doubles On Better Operating Performance
Siemens' Q2 net profit rose 70.2% year-on-year to Rs 803 crore, as compared with Rs 472 crore a year ago.
Siemens India Ltd.'s net profit for the second quarter of fiscal 2024 nearly doubled on the back of strong operating numbers.
The net profit of the global technology and infrastructure solutions provider rose 70.2% year-on-year to Rs 803 crore, as compared with Rs 472 crore a year ago, according to its exchange filing.
Q2 FY24 Earnings Highlights (YoY)
Revenue rose 18.4% to Rs 5,750 crore from Rs 4,858 crore a year ago.
Operating profit, or Ebitda, was up 41.4% to Rs 878 crore from Rs 621 crore a year ago.
Operating margin was up at 15.3% from 12.8% a year ago.
Net profit rose 70.2% to Rs 803 crore from Rs 472 crore a year ago.
Received new orders worth Rs 5,184 crore.
Siemens To Demerge Energy Business
Siemens India also announced the demerger of its energy business, Siemens Energy India Ltd., which will be separately listed on the BSE and NSE.
The energy business—that is engaged in providing fully integrated products, solutions and services, across the energy value chain of oil and gas production and power generation and transmission—had a revenue of Rs 5,986.9 crore in FY23 and contributed 34% to the overall turnover of Siemens India.
As part of the demerger plan, shareholders of Siemens will get one share of energy business for every share held by them, the company said.
The energy business is likely to be demerged in 2025 and subsequently listed on the exchanges, according to the company.
Operational Performance
The company saw deferment of some large orders during the quarter due to bureaucratic issues. There has also been a slowdown in ordering of industrial automation products due to normalisation of demand following shorter delivery cycles.
The supply chain issues related to semiconductor prices extended timelines for delivery of certain products in the industrial automation segment, Siemens India CEO Sunil Mathur said in a media conference call.
"The timelines for these products got extended by 12-18 months, compared to pre-Covid period when it got delivered in couple of weeks," he said. To counter the delay, customers would order in advance. However, in the meantime, the timelines have improved substantially, hence the product inventories had to be rundown before taking fresh orders, Mathur added.
"It's a supply chain-driven slowdown and not market-driven. We expect the stabilisation to happen in the first quarter of the next financial year or the October-December quarter," Mathur said.
The deferment issue will also get resolved in the next two quarters.
Shares of Siemens closed 0.39% higher, as compared with a 0.45% increase in the benchmark Sensex.
