BENGALURU (Reuters) – Siemens Ltd, the Indian arm of German engineering company Siemens AG, reported a near-39% rise in quarterly profit, helped by a boost in infrastructure spending in the country.
Consolidated net profit rose to 4.71 billion rupees ($57.59 million) in the second quarter ended March 31, from 3.40 billion rupees a year earlier, the company said on Thursday.
Like its peers ABB India Ltd and Larsen & Toubro Ltd, Siemens has gained from government spending on infrastructure, especially railways, metros and highways, after a pause due to the COVID-19 pandemic.
In January, the infrastructure developer signed a contract worth 260 billion rupees with the railway ministry for an electric locomotive project in the western state of Gujarat, its biggest order in India. The company booked new orders worth 311.51 billion rupees during the quarter.
Revenue at its smart infrastructure and energy segments, which combined account for about 67.5% of the total, rose 15.8% and 30%, respectively. This helped total revenue from operations jump 27.8% to 48.58 billion rupees.
Last month, Prabhudas Lilladher analysts said they were “positive” on Siemens due to the company’s wide portfolio, market position in digitalisation and automation, and focus on product localisation.
“We continue to see substantial tendering by the Indian Railways and continued capex expansion in infrastructure led by Central Government spending” said Sunil Mathur, managing director and chief executive of Siemens, in a statement.
Rise in input cost, purchases of stock-in-trade, and project buy-outs, however, pushed total expenses up 26.3%.
Shares of the company closed 2.2% higher to an all-time high of 3,797.05 rupees on Thursday ahead of the results.
($1 = 81.7800 Indian rupees)
(Reporting by Biplob Kumar Das in Bengaluru; Editing by Sohini Goswami)
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