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Sona Comstar gains 17% after strong June quarter performance

On a sequential basis, Sona Comstar gained 36.70%, compared with about  ₹60 crore recorded in the fourth quarter last financial year. However, revenue from operations during the quarter declined by 7% sequentially to  ₹501 crore as against  ₹539 crore in the January-March quarter.Premium
On a sequential basis, Sona Comstar gained 36.70%, compared with about 60 crore recorded in the fourth quarter last financial year. However, revenue from operations during the quarter declined by 7% sequentially to 501 crore as against 539 crore in the January-March quarter.

  • The company reported a consolidated net profit of 82 crore for the quarter ended 30 June against a net loss of 4.6 lakh in the April-June quarter last fiscal

MUMBAI : Shares of auto components maker Sona BLW Precision Forgings (Sona Comstar) gained 17% after it reported a consolidated net profit of 82 crore for the quarter ended 30 June against a net loss of 4.6 lakh in the April-June quarter last fiscal.

This is Sona Comstar's first announcement of quarterly results as a listed entity. On a sequential basis, it gained 36.70%, compared with about 60 crore recorded in the fourth quarter last financial year. However, revenue from operations during the quarter declined by 7% sequentially to 501 crore as against 539 crore in the January-March quarter.

JM Financial in a note to clients said: "Electric Vehicle (EV) share of revenue increased 6 % points to 20% during June quarter. The net order book stands at 14,000 crore with 57% of orders from battery electric vehicles (BEVs). Management highlighted that semiconductor shortage is likely to remain for 12-18 months but the company’s revenue growth is likely to be supported by new order wins. Commodity cost is passed on with a lag of 2-6 months and long-term earnings before interest, tax, depreciation, and ammortization (Ebitda) margin is expected to remain in the range of 26-28%. Diversified revenue, increasing contribution from EVs, strong order book and financial metrics make Sona Comstar one of the best plays in the EV space."

On 24 June 2021, the Gururgam-headquartered company listed on NSE and BSE. It is a global supplier with nine manufacturing and assembly facilities across India, the US, Mexico and China.

"We are delighted to report a strong performance in our first earnings announcement as a listed entity. Despite headwinds, we have delivered robust revenue growth and best-in-class profitability and return metrics,Our net order book stands at 14,000 crore as of 30 June 2021 of which 57% is from EV," Sona BLW Precision Forgings managing director and group chief executive officer Vivek Vikram Singh said in a statement.

The company continues to make significant progress on its strategic imperatives of increasing electrification, global market share, diversification, and product innovation, he added.

In July, Sona Comstar and Israel's IRP Nexus Group have come together for a project that will manufacture new e-motor technology, and market it globally. Under this project, Sona Comstar and IRP have collaborated to conceive, design, prototype, and manufacture high-efficiency, low-cost, magnet-less powertrain (motor + controller) for electric two- and three-wheelers applications up to 15kw for the global market. IRP will license its technology to Sona Comstar for manufacturing of the system exclusively in India.

Shares of Sona BLW Precision Forgings closed at 480.05 up 16.56% from its previous close, while the benchmark index, Sensex gained 0.23% to 54,402.85.


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