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Home arrow News arrow Business News arrow Cummins India records 12% increase in net sales for Q1 FY12 at Rs 1021.9cr
Cummins India records 12% increase in net sales for Q1 FY12 at Rs 1021.9cr Print E-mail
Written by Vivek, Arjun   
Friday, 05 August 2011
Pune: Cummins India Limited, a manufacturer of diesel and natural gas engines for power generation, industrial and automotive markets, has recorded a 12 percent increase in net sales for the quarter ended June 30, 2011 at Rs. 1021.9 crores.

"The Company has demonstrated respectable sales growth this quarter over the same quarter last year despite the headwinds of higher interest rates and reduced liquidity.  Margins have however been negatively impacted as commodities and other input costs have escalated significantly," said Anant J Talaulicar, Chairman & Managing Director, Cummins India Limited.

Domestic sales grew 8% as compared to the same period last year. Exports grew 26% as compared to the same period last year. Net profit before tax excluding exceptional items for the quarter was Rs. 191.8 crores, was a small decline compared to Rs. 197.4 crores in the same period last year.

"Our continued focus on improving efficiencies and reducing costs, as well as some price increases helped the Company partially offset the significant input cost increases.  We are strongly positioned in the market and I remain confident of our Company’s ability to sustain our leadership position and long term profitable growth.  Our balance sheet remains strong and we continue to invest in technologies, products and manufacturing capacities as we remain committed to serve our customers well and deliver on our Brand Promise of Dependability," he added.

During the quarter, the Company divested its entire shareholding in Cummins Exhaust India Limited (a joint venture engaged in the business of manufacture and sale of exhaust silencers and mufflers for Internal Combustion Engines), as it was no longer considered core or strategic to the Company.  A profit of Rs. 51.4 crores was realized on this divestment.  Net profit before tax including this exceptional item rose 23% to Rs. 243.2 crores during the quarter as compared to same period last year.

The company is investing nearly Rs 337 crore to set up a global technology centre in Pune for research and development projects. This centre is expected to employ over 2500 engineers. Cummins' upcoming plant at Phaltan is expected to be operational by the end of 2012, with an initial capacity of 15000 engines (for commercial vehicles, generators and other industrial applications). The capacity will be doubled in due course.

A new production operation in Chennai, India, will complement the mechanical B3.3 engine manufacturing in Japan, providing a major increase in build capacity to meet the continuing growth in demand from compact equipment manufacturers worldwide.

The Board of Directors have recommended issue of Bonus Shares in the proportion of 2 (two) Bonus equity shares of Rs. 2/- each for every 5 (five) existing equity shares of Rs. 2/- each fully paid up, by capitalization of reserves of the Company, subject to applicable approvals.

"In commemoration of the 50th annual general meeting of the Company and with a view to celebrate the Company’s excellent performance over the past several years, it is proposed to further enhance value for the shareholders by issuing and allotting fully paid bonus shares of the face value of Rs. 2/- each in the ratio of 2:5," Talaulicar said.

Cummins in India is a Group of eight legal entities across 200 locations in the country with a combined turnover of approximately Rs. 8,600 crores and employing more than 11,000 individuals. The company aims to triple its annual revenue to $2.7 billion over the next 5 years.

 
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