Motherson Sumi posts nearly four-fold jump in Q3 profit at ₹1,268.31 cr
Auto components major Motherson Sumi Systems on Friday reported nearly four-fold jump in consolidated net profit from continuing and discontinued operations at ₹1,268.31 crore in the third quarter ended December 31, 2020.
The company had posted a consolidated net profit from such operations of ₹340.32 crore in the same period last fiscal, Motherson Sumi Systems Ltd (MSSL) said in a regulatory filing.
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The company’s consolidated total revenue from operations during the period under review at ₹17,092.44 crore. It had registered a consolidated revenue from operations of ₹15,000.10 crore in the same period last fiscal.
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MSSL said its board had on July 2, 2020, approved a group reorganisation plan that entails demerger of domestic wiring harness (DWH) business from MSSL into a new company Motherson Sumi Wiring India Ltd (MSWIL) and subsequent merger of SAMIL into MSSL to consolidate 100 per cent shareholding in Samvardhana Motherson Automotive Systems Group BV (SMRP BV) as well as to bring all auto component and allied businesses in Samvardhana Motherson International Ltd (SAMIL) under MSSL.
The scheme has been considered as highly probable and demerger of DWH into MSWIL meet the criteria to be considered as discontinued operation, hence DWH business has been disclosed as discontinued operation in consolidated financial results.
Motherson Sumi Systems Chairman Vivek Chaand Sehgal said, "Our global teams have put in tremendous efforts in challenging conditions to ensure uninterrupted supplies to our customers. These quarterly numbers are a reflection of their hard work as well the trust of our customers on Motherson."
During the quarter, MSSL said its operations have normalised, with most facilities running at pre-COVID levels. There are sustained improvements in performance of greenfield plants with a continued focus on cost reduction and efficiency improvements.
There are indications of positive consumer sentiments reflected by increased demand globally, it added.
On the outlook, the company said automobile manufacturers continue to work with suppliers, given challenges in supply of certain critical components.
"With the rollout of COVID-19 vaccine in different parts of the world, we are optimistic that the demand and positive sentiments will improve in the upcoming quarters," Sehgal said.