Shares of Cummins India declined as much as 4% on Thursday after the company during its earnings call said that it is becoming a challenge to maintain their gross margins due to the rally in global metal prices.
The management also said that they are witnessing significant pressure on material margins going forward.
For the March quarter, Cummins India's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) margins were at a multi-quarter high, rising to 23.5%, compared to 16.9% during the same period last year.
The management said that it aspires to improve its margins with their new CPCB IV products. During the March quarter, nearly a third of Cummins India's sales came from these products.
CPCB IV are norms are designed to significantly lower the levels of harmful pollutants like oxides of Nitrogen, Carbon Monoxide and particulate matter, emitted by diesel generators. These are the most stringent and recent environmental regulations set by the Central Pollution Control Board for diesel generators.
Exports for Cummins India did not grow in any market in the year gone by, according to the management. There was a decline in the European exports, which are at an all-time low, while the African business is struggling due to the currency fluctuations. The management aspires to have exports return to contributing 30% to 35% of the overall topline by financial year 2025.
For financial year 2024, Cummins India reported an overall volume growth of 30%.
Among the positives, the management said that data centres, infra-related growth, investments in power generation continue with reasonably strong demand seen across all segments.
Shares of Cummins India are trading 3.9% lower at ₹3,686.25. The stock has already risen 90% so far in 2024.
The management also said that they are witnessing significant pressure on material margins going forward.
For the March quarter, Cummins India's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) margins were at a multi-quarter high, rising to 23.5%, compared to 16.9% during the same period last year.
The management said that it aspires to improve its margins with their new CPCB IV products. During the March quarter, nearly a third of Cummins India's sales came from these products.
CPCB IV are norms are designed to significantly lower the levels of harmful pollutants like oxides of Nitrogen, Carbon Monoxide and particulate matter, emitted by diesel generators. These are the most stringent and recent environmental regulations set by the Central Pollution Control Board for diesel generators.
Exports for Cummins India did not grow in any market in the year gone by, according to the management. There was a decline in the European exports, which are at an all-time low, while the African business is struggling due to the currency fluctuations. The management aspires to have exports return to contributing 30% to 35% of the overall topline by financial year 2025.
For financial year 2024, Cummins India reported an overall volume growth of 30%.
Among the positives, the management said that data centres, infra-related growth, investments in power generation continue with reasonably strong demand seen across all segments.
Shares of Cummins India are trading 3.9% lower at ₹3,686.25. The stock has already risen 90% so far in 2024.
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