Samvardhana Motherson Q2 results: PAT rises over four-fold to Rs 880 crore

Indian auto parts maker Samvardhana Motherson misses Q2 profit estimates as car sales slow  Indian auto parts maker Samvardhana Motherson International reported a smaller-than-expected increase in second-quarter profit on Tuesday, hurt by slower demand.

 

The company, which supplies Maruti Suzuki, Mercedes Benz, Audi and other automakers, said consolidated net profit rose over four-fold to 8.8 billion rupees ($104.27 million) for the three months ended Sept. 30. 

However, that missed analysts' average estimate of 9.15 billion rupees, according to data compiled by LSEG. 

Indian automakers reported a decline in shipments to dealers for the first time in more than two years during the July-September quarter, to help manage the excess inventory. 

 

This impacted companies such as Samvardhana Motherson, which makes products like bumpers and mirrors for vehicles and generates 75% of its revenue from the automobile industry. 

Its total revenue from operations of 278.12 billion rupees in the quarter also missed analysts' estimates of 281.88 billion rupees, while the 18.2% growth rate was slower than the 28.3% rate in the same period a year ago. 

Cost of raw materials and services, a major chunk of the total expenses, jumped 10.7%, pushing total expenses up by 18% to 270.13 billion rupees. 

The company's earnings before interest, taxes, depreciation, and amortization (EBITDA) margin was 8.9%, up from 8.5% in the year-ago quarter but down from 9.6% in the previous quarter. 

Samvardhana's shares closed about 5% lower after the company reported its quarterly results.