The Hindu Business Line : Growth in global biz boosts Elgi Equipments net

Coimbatore, July 28 Air compressor and automotive equipment manufacturer Elgi Equipments Ltd (EEL) has posted a 60 per cent growth in international business in the first quarter of current fiscal compared to the corresponding period last year.

The company, while conceding that inflationary trend in the economy might bring pressure on the margins, said it was taking steps to mitigate its impact.

In a release, EEL said its sales grew by 22 per cent to Rs 130.7 crore compared to Rs 107.1 crore in the same period last year. The profit after tax grew to Rs 9.6 crore (Rs 7.8 crore). The domestic compressor business showed a robust growth that came from sectors associated with infrastructure like cement, steel and construction and it expected the momentum to continue.

EEL cited “improved engagement levels with distributors and key customers” for its growth in international business. The company incorporated two foreign subsidiaries – at China and Sharjah Airport International Free Zone during this quarter.

Dr Jairam Varadaraj, Managing Director, EEL, said despite decline in the automotive equipment business, the efforts in the oil and tyre segments contributed to profit growth.

Looking forward, he said the spiralling commodity prices and inflationary trend were expected to bring pressure on the margins but steps were being taken to reduce its impact.

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