Companies

Elgi Equipments posts ₹57 cr standalone profit in Q2

Our Bureau | | Updated on: Nov 09, 2021
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Costly raw materials and longer gestation for price corrections shrunk the margins, said the company

Elgi Equipments, manufacturer of air compressors, posted a consolidated profit after tax (PAT) of ₹52 crore for the September 2021 quarter, compared to a PAT of ₹33 crore in the same period last year. The standalone PAT for the second quarter of this fiscal was ₹57 crore (₹30 crore).

Though commodity prices increased in the second quarter, it was not happening as repeatedly and as frequently as it happened during the first quarter. With commitments made to government-related orders, for supplying compressors for oxygen generators as well as longer gestation for price corrections in the markets, margins shrunk significantly. However, the company expects that price correction and cost management would result in gradual recovery of the margins,” according to a statement.

Elgi Equipments posts ₹26-cr standalone PAT in Q1

Consolidated sales for the quarter stood at ₹652 crore against ₹480 crore in the corresponding quarter in 2020-21. Standalone sales stood at ₹416 crore ( ₹265 crore).

But for Australia and South-East Asia, which faced a resurgence of Covid-related disruptions, the company’s performance has been good across markets.

The company’s Chinese subsidiary Elgi Equipments (Zhejiang) Ltd was deregistered on July 5, 2021. Consequently, loss arising on deconsolidation of the subsidiary, amounting to ₹1.92 crore is recognised as part of other expenses for the quarter and half year ended September 30, 2021.

Sales of the company’s automotive business bounced back to pre-Covid level and increased by 45 per cent compared to the corresponding period of FY21.

Elgi Equipments charts mid-term plan to achieve $400 m revenue by FY26

Outlook

The performance in the second quarter is expected to continue in the third quarter as well, it said.

Published on November 09, 2021

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