Foreign exchange loss hurts Suzlon’s profit

Foreign exchange loss hurts Suzlon’s profit
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First Published: Thu, Jul 31 2008. 11 47 PM IST
Updated: Thu, Jul 31 2008. 11 47 PM IST
Mumbai: India’s biggest maker of wind turbines, Suzlon Energy Ltd, advanced in Mumbai trading after reporting higher margins in first quarter group profit.
Margins rose 84% to Rs70 lakh per megawatt in the quarter from Rs38 lakh a year earlier, chairman Tulsi Tanti told reporters in Mumbai on Thursday. Prices of wind turbines increased by 3-4%, he said.
Suzlon shares closed up 1.83% at Rs222.80 on Thursday in Mumbai trading after rising as much as 5.6%. The shares have fallen 42% so far this year compared with a 30% decline in the benchmark Sensex index of the Bombay Stock Exchange.
Net income fell to Rs1.35 crore in the first quarter from Rs18.89 crore a year earlier, Ahmedabad-based Suzlon said in a release on Thursday.
Revenue rose 43% to Rs2,834 crore. Suzlon reported a foreign-exchange loss of Rs164 crore from overseas borrowings of $500 million (Rs2,125 crore) after using the funds to buy shares in European rival Repower Systems AG.
Suzlon has been dogged by concern that blade defects may prompt customers to cancel orders.
Last month, a unit of southern California power company, Edison International, declined to take delivery of 150 turbines after complaining that it received faulty equipment, Suzlon said.
The company set aside Rs590 crore to compensate customers for cracked blades, chief financial officer Kirti Vagadia said on 10 July.
Suzlon said it has orders in hand worth Rs16,490 crore. This includes an order from realty firm DLF Ltd for turbines to generate 106.5MW of electricity.
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First Published: Thu, Jul 31 2008. 11 47 PM IST