ABB India advanced 2.38% to Rs 1,885.60 after the company's net profit (from continuing operations) jumped 40.33% to Rs 119.97 crore on a 10.31% surge in total revenue from operations to Rs 1,778.39 crore in Q3 September 2021 over Q3 September 2020.
Profit margin stood at 6.7% in Q3 2021 as compared to 5.3% in Q3 2020. Operational EBITA grew 63.10% to Rs 168 crore in Q3 2021 from Rs 103 crore in Q3 2020. Operational EBITA margin was at 9.4% in Q3 2021 as against 6.4% in Q3 2020.
Robust backlog execution, customer-connect and service business led to the positive revenue movement in the quarter. Revenues in electrification business grew by 17% Y-o-Y (year-on-year); Motion business saw a 11% Y-o-Y growth across all divisions supported by bounce back of service revenue streams and backlog conversion; Robotics and Discrete Automation segment posted a revenue growth of 42% Y-o-Y and Process Automation remained flat with some lags in dispatch clearances from customers.
The company reported a profit before tax (before exceptional items and one-offs) was at Rs 165 crore for the quarter mainly driven by better capacity utilization, revenue mix, operational efficiency and cost optimization. Profitability improvement was witnessed across all business segments with service and product revenues while external headwinds like increasing commodity prices, supply disruptions in electronic components were building up. The company's cash position continued to remain strong at Rs 2,481 crore at the end of Q3 2021 vis-a-vis Rs 1,598 crore in Q3 2020, recording an increase of 55% Y-o-Y.
Total orders for the quarter were at Rs 1,909 crore as compared to Rs 1,308 crore in Q3 2020, registering a growth of 46% Y-o-Y. The order growth was the highest in Q3 in the last five years. The order backlog stood at Rs 4,765 crore, which provides revenue visibility and allows the company to capitalize on market developments in the coming quarters.
For its outlook, ABB India stated, "The Indian economy witnessed a sharp recovery led by improved macro backdrop, favorable global macro environment, and healthy rise in COVID vaccination. However, fear of resurgence of cases and its impact on domestic and global business traction remain areas of uncertainty. Also, a key element would be to adopt suitable monitoring, forecasting models to mitigate supply chain disruptions in plastics, semi-conductors as well as electronic components, which is impacting businesses across geographies. ABB India continues to have all precautionary and safety protocols in place while continuously monitoring key mar- kets and segments. For now, demand is currently coming from sectors like renewables, water & wastewater, warehousing, F&B, pharma, data center, etc. while the company is preparing for evolving tech- nology models and markets. ABB will continue to focus on order wins and seamless execution across projects while continuing to engage closely with customers."
Sanjeev Sharma, the managing director (MD) of ABB India, said, "ABB India posted a strong recovery in all our key market segments resulting in strong order booking. We believe that we are reasonably positioned to deliver on our ambitious goals with a stable and growing order backlog, robust cash reserves, cost optimization initiatives and business continuity plans. The strong demand for ABB products, solutions and services portfolio in many of our targeted market segments along with our continuous focus on operational efficiency and cost control ensured improvement in profitability despite the sharp increase in commodity prices during the quarter."
"The health and safety of all our stakeholders remains our top priority and we have continued our efforts to support the country's vaccination program. We are progressing well on our ESG agenda aligned with the group and led by green factory certifications across locations. We will continue to enhance our CSR activities specifically in areas like healthcare and education for socially disadvantaged sections," he added.
ABB India is engaged in power and automation business in India.
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