Motherson Sumi declares lower than expected results: stock falls 10 per cent

Motherson Sumi Systems (MSSL) announced its third quarter results on Tuesday. Consolidated net profit of the company jumped 20.91 per cent year on year (YoY) to Rs 307 crore during October-December period against Rs 254 crore in the same quarter last year. The result is lower than expected. 

On financial front, the consolidated net revenue from operations of MSSL reached to Rs 9860 crores in Q3FY16 compared to Rs 9149 crores in Q3FY15, an increase of 7.76 per cent YoY. The EBITDA stands at Rs 947 crores this quarter compared to Rs 829 crores in Q3FY15, an increase of 14.20 per cent YoY. The EBITDA margin of company stands at 9.60 per cent this quarter compared to 9.06 per cent in Q3FY15. The net profit stands at Rs 307 crores in Q3FY16 compared to Rs 254 crores in Q3FY15, an increase of 20.90 per cent YoY. The profit growth of MSSL is even stronger than revenue growth, reflecting the solid operational improvements the company is making to strengthen the foundations for further customer-led growth. 

The nine month ending consolidated net revenue from operations increased by 11.28 per cent and reached to Rs 28,442 crores compared to Rs 25,558 crores for the same period last year. The net profit for nine month period stands at Rs 860 crores compared to Rs 522 crores, an increase of 64.75 per cent from the same period last year.

Vivek Chaand Sehgal, MSSL’s Chairman added “These third quarter results reflect our efforts to further strengthen our foundations. We continuously look for ways to improve the performance of each unit around the world. That way, we strengthen our support to customers from the bottom up and adapt to the evolving requirements of the market. This culture of improvement is very important to us." 

This quarter MSSL also announced update on 17 plants commissioned around the world, across its major product verticals, out of which 7 have been completed. The stock of company is trading at Rs 245.35, a decrease of Rs 9.62 per cent from previous close.