• OPM contracted by 50 bps to 7.8% and that is largely due to higher material cost as well as staff cost. Material cost as proportion to sales net of stocks was up by 230 bps to 57.4%. Similarly the staff cost too was higher by marginal 20 bps to 11.5%. However the cost of traded goods was down by 40 bps (to 13.9%) and OE was down by 180 bps (to 9.0%). Thus facilitated by higher sales (up 9% to Rs 1491.78 crore), the operating profit was up by 1% to Rs 115.67 crore.

• Upside in revenue was largely driven by electro mechanical projects (EMP) and engineering products & services (EPS). The segment revenue of EMP was higher by 16% to Rs 875.23 crore on execution of strong quality order book. The segment revenue of engineering products & services (EPS) was up by 20% to Rs 83.16 crore. And the segment revenue of Unitary cooling products (UCP) was down by 3% to Rs 525.92 crore.

• EBIT for the quarter was down by 6% to Rs 135.78 crore with downside coming largely from UCP division. The segment profit of Unitary cooling products was down by 37% to Rs 44.68 crore hit by challenging market condition where the rising material cost could not be passed on to the customer due to high channel inventory and discounting to liquidate the unusual high stock in the channel by industry players. The segment margin of UCP was down by 450 bps to 8.5%. The segment profit of EPS was up by 4% to Rs 21.92 crore largely due to higher sales as its segment margin was down by 400 bps to 26.4%. However with the company focus on profitable orders, the segment profit of EMP was higher by 30% to Rs 69.18 crore with its segment margin expand by 80 bps to 7.9%.

Nine month performance

Sales was up by 16% to Rs 5061.23 crore and the operating profit was up by 14% to Rs 467.40 crore with OPM flat at 9.2%. After accounting for lower OI, higher interest and lower depreciation, the PBT before share of profit from associate was up by 8% to Rs 556.07 crore. The share of loss from associate was Rs 32.49 crore compared to a profit of Rs 4.79 crore in the corresponding previous period. Thus the PBT after share of profit from associate was Rs 523.58crore, a growth of just 1%. The EO was an expense of Rs 11.77 crore compared to an income of Rs 2.00 crore in corresponding previous period. Thus PBT after EO was down by 2% to Rs 511.81 crore. With taxation higher by 2% to Rs 139.67 crore, the PAT was down by 3% to Rs 372.14 crore.

After accounting for higher minority interest (up 123% to Rs 6.68 crore) and a swing of Rs 110.9 crore in other comprehensive expense to Rs 19.32 crore, the total comprehensive income attributable to owners was down by 28% to Rs 268.06 crore.