Texmaco Rail & Engineering Ltd, a Adventz Group Company, registered 89 per cent drop in net profit at ₹2 crore for the quarter ended December 31, 2021, as compared with ₹18 crore same period last year.

Revenues during the quarter under review increased by nearly three per cent at ₹470 crore as against ₹458 crore same period last year.

While the company was coming out of the Covid-related disruptions in the first two quarters, the sudden surge in cases caused by the third wave impacted due to restrictions imposed by the State government from time-to-time and intermittent disruptions in operational activities, the company said in a press statement.

The performance of the heavy engineering division was impacted during the quarter primarily on account of continued unprecedented hike in steel price, the main raw material for the division, and resultant uncertainties.

“The situation however is fast easing out and government has eased the restrictions with lot of relaxations leading to expected normal operations in Q4 of the financial year,” the release said.

Govt’s capex plan

The Railway Budget has revised capital expenditure outlay of ₹2.45 lakh crore for railway infrastructure and development. The government’s plan to prioritise the multi-modal connectivity between mass urban transport and rail network, as part of “PM Gati Shakti” scheme, would open new opportunities both in railway manufacturing and service sectors. This would boost the prospects of the company, which is present in most of the rail-related segments.

The heavy engineering division is expected to be benefitted with the government’s thrust on rail infrastructure and major capex in the rail segment. The government’s focused approach on completion of freight corridor works and upgrading the railway would also augur well, it said.

The company’s steel foundry division continues to perform reasonably in spite of Covid-related restrictions and serious challenges faced due to global shortage of containers and shipping woes on backing of strong demand from export. The division reported a gross revenue of around ₹71 crore during the quarter.

The Rail EPC division is presently focusing on expeditious execution activities and contract closure activities. The division reported a gross revenue of around ₹225 crore during the quarter.

The Kalindee unit is concentrating on capitalising the possibilities in metro projects and signaling, the core strength of the company.

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