Industrial Machinery company Elecon Engineering Company announced Q2FY25 results Financial Highlights: Gear Division: Revenue for Q2FY25 stood at Rs 398 crore as compared to Rs 423 crore in Q2FY24. Revenue from Gear division were impacted on account of delay in receipt of order from customers resulted in delay in execution within Q2FY25. We anticipate faster execution in balance H2FY25 to achieve the overall guidance for FY25. EBIT for Q2FY25 stood at Rs 82 crore as compared to Rs 110 crore in the corresponding quarter last year. The EBIT Margin for the quarter ended September 2024 stood at 20.5% as compared to 26.0% in the corresponding quarter last year. Margins in Gear division were primarily impacted on account of higher freight costs and one time repair and maintenance expenses. MHE Division: Revenue for the quarter stood at Rs 110 crore as compared to Rs 62 crore in the corresponding quarter last year, growing 77.8%YoY. EBIT for Q2FY25 stood at Rs 29 crore registering a growth of 124.3% YoY. The EBIT margins stood at 26.5% as against 21.0% in Q2FY24, an improvement of ~549 bpsYoY primarily on account of better product mix & higher contribution from the aftermarketsegment. The company continues to focus on the business of supplying products & aftermarket business for its MHE segment which has led to sharp turnaround in the profitability for this segment. The company is consistently securing new orders for product supply and capitalizing on growing opportunities in the aftermarket business. Our focus on product supply and aftersales are yielding positive results and are optimistic of growth in coming quarters in the MHE segment. Other Highlights: Breakthrough for overseas market for MHE Division: Successfully Secured an order from Overseas market valued of USD 1.65 million in Q2FY25. Improvement in Credit Ratings: LT -[ICRA] AA (Stable); ST: [ICRA] A1+ in July-24 improved from LT -[ICRA] AA-(Stable); ST: [ICRA] A1+ in June-23. Interim Dividend: Declared an interim dividend of Re 0.50/- each (i.e., 50%) per equity share of Face Value Re 1/- each. Shri Prayasvin B. Patel, Chairman & Managing Director of Elecon Engineering Co. said: For Q2FY25, Elecon reported consolidated revenues of Rs 508 crore, reflecting a 4.8% year-on-year growth. The quarter's EBITDA stood at Rs 112 crore, with EBITDA margins at 22.1%. Profit after Tax (PAT) for Q2FY25 was Rs 88 crore, with PAT margins at 17.3%. Elecon remains the domestic market leader in Industrial Gear Solutions and Material Handling Equipment, offering cutting-edge manufacturing, top-tier products, and the capability to deliver customized solutions with minimal lead times. In Q2FY25, our Material Handling Equipment (MHE) division saw a remarkable 77.8% year-on-year revenue growth, with EBIT margins improving by ~549 basis points to 26.5%. We expect continued growth in this segment, driven by infrastructure development, government initiatives, and an uptick in capital expenditure Our Gear division, however, experienced a 5.9% decline in revenue due to delay in order inflows. We see this as a temporary decline and expect to recover in the following quarters, remaining optimistic about overall revenue growth for FY25. Margins in the Gear division were affected by higher freight costs and changes in the product mix. Internationally, we are progressing toward our target of generating 50% of our revenue from overseas markets by FY30. In Q2FY25, international business contributed approximately 24% of our total consolidated revenue. With strong support from OEMs and ongoing brand-building efforts, we are confident in reaching this goal. Through strategic alliances in global markets, continued investment in R&D; and product development, and a focus on the MHE segment, we are confident in outperforming industry trends and achieving our long-term goals. Our priority remains sustainable revenue and profitability growth, creating long-term value for our shareholders. Result PDF