Top 5 Companies With Declining Net Profits In Last 4 Quarters

With the results season for the first quarter of FY14 coming to an end, we decided to look at the top 5 companies that have a witnessed a decline in their net profits consistently for the last 4 quarters. We have taken into consideration those companies that have a market capitalisation of more than Rs 100 crore.

Engineers India: Engineers India (EIL) was set up in 1965 to provide engineering and related technical services for petroleum refineries and other industrial projects. The company is working under the administrative control of the Ministry of Petroleum and Natural Gas (MoP&NG), Government of India. In addition to petroleum refineries, with which it started initially, it has diversified and excelled in various other fields over the years. Today, EIL has emerged as India’s leading design, engineering and turnkey contracting company providing a complete range of project services.

On the financial front, though, the company has witnessed a decline in its net profits consistently for the last four quarters. This stood at Rs 443.19 crore as of Q1FY14, against Rs 667.74 crore during Q2FY13. The company has a market capitalisation of Rs 4292.57 crore and has generated a negative return of 44.35% on a YTD basis.

FAG Bearings India: FAG Bearings India was incorporated in 1962 and is a subsidiary of FAG Kugelfischer GmbH. The company was formerly known as FAG Precision Bearings and changed its name to FAG Bearings India in 1999. It engages in the manufacture and sale of ball/roller bearings and related components in India. The company’s products include ball bearings, cylindrical roller bearings and spherical roller bearings. It serves various industry segments, including construction machinery, electrical engineering, fluid technology, conveying equipment, industrial gears, mining and cement, to name a few. It also exports products to Europe, the US and Asia.

With a market capitalisation of Rs 1886 crore, the company has generated a negative return of 32.31% on a YTD basis. Its bottomline stood at Rs 309.51 crore as of Q1FY14, against Rs 353.93 crore during Q2FY13.

ABG Shipyard: ABG Shipyard, the flagship company of the ABG Group, was incorporated in the year 1985 as Magdalla Shipyard with the primary objective of engaging in the shipbuilding and ship repair business. Since 1991, in a span of 15 years, the company has achieved the status of the largest private sector shipbuilding yard in India. In the past decade, the shipyard has constructed and delivered 104 vessels for leading companies in India and abroad.

However, its net profit has declined from Rs 640.13 crore in Q2FY13 to Rs 391.57 crore in Q1FY4. The company has generated a negative return of 21.70% on a YTD basis.

Shipping Corporation of India: Shipping Corporation of India (SCI) was established on October 2, 1961, by amalgamation of the Eastern Shipping Corporation and Western Shipping Corporation. Starting out as a marginal liner shipping company with just 19 vessels, SCI has evolved into the largest Indian shipping company today, with substantial interests in various segments of the shipping trade.

Despite its status as a key player in the field and its market capitalisation of Rs 1148 crore, the company has generated a negative return of 44.45% on a YTD basis. Its bottomline stood at Rs 917.65 crore as of Q1FY14, against Rs 1025.91 crore during Q2FY13.

Maharashtra Seamless: Maharashtra Seamless (MSL) is one of the flagship companies of the Rs 4000 crore D.P. Jindal Group. The company manufactures a whole range of high class, customisable and innovative seamless pipes and tubes using state-of-the-art technology. It has also diversified into the power generation business, with a 7 MW wind power project at Satara, Maharashtra, thus committing itself to ‘green’ power.

Its net profit, though, has declined from Rs 480.72 crore in Q2FY13 to Rs 327.35 crore in Q1FY4. The company has generated a negative return of 31.52% on a YTD basis.