3Q profit jumps 21% driven by Dutch unit
NEW DELHI (NewsRise) -- Motherson Sumi Systems, India's largest auto parts maker, posted a 21% jump in third-quarter net income, boosted by higher sales at its overseas units after the company boosted production capacity.
Consolidated net income rose to 3.07 billion rupees ($45 million), from 2.54 billion rupees in the year earlier period, Motherson said in a statement on Tuesday. Sales climbed 8% to 96.76 billion rupees, with revenue from abroad rising 9% to 83.01 billion rupees.
The company said Netherlands unit Samvardhana Motherson Automotive Systems Group drove quarterly performance with an 18% jump in revenue in Euro terms and 22% gain in operating profit, despite increased investments in new plants. Another subsidiary Samvardhana Motherson Reflectec, which makes rear-view mirrors, reported its highest ever quarterly profit, with revenue surpassing 1 billion euros in less than nine months of the current fiscal year.
"The performance is all the more encouraging, in light of the worries that surround the global automotive industry," Chairman Vivek Chaand Sehgal said in the statement.
Local sales grew 4% to 13.76 billion rupees, as the company said floods in the southern India state of Tamil Nadu resulted in some clients closing down operations for two to three weeks in December.
Motherson is the flagship company of Samvardhana Motherson Group, which has presence in 25 countries across six continents. The company has grown to become India's largest auto parts maker through a string of acquisitions in recent years. It aims to earn revenues of $18 billion by 2020.
An emission cheating scandal at Motherson's key customer Volkswagen in September had raised concerns that supplies to the German automaker would be affected. The company, however, said the scandal won't affect its revenue targets as it doesn't supply any engine parts to Volkswagen.
Motherson shares fell 11.1% at 241.40 rupees on Tuesday, while the benchmark S&P BSE Sensex ended 1.1% lower.