India's Greaves Cotton posts Q2 loss on one-off charge

Greaves Cotton

07/11/2023 12:07

BENGALURU, Nov 7 (Reuters) - India's Greaves Cotton
 GRVL.NS  on Tuesday reported a second-quarter loss, hurt by a
one-time charge relating to a government incentive for electric
scooter sales and higher expenses.
    The company posted a consolidated loss of 1.91 billion
rupees ($22.9 million) for the quarter ended Sept. 30, compared
to a profit 288.8 million rupees last year.
    Greaves had in May received a notice from the Indian
government which alleged its electric vehicle unit failed to
adhere to guidelines of an e-scooter incentive scheme, and
directed that it return the subsidies claimed.
    Separately, the government in May slashed e-scooter cash
incentives without explanation, saying it would pay just up to
15% of the price before taxes, compared to 40% earlier.
    Greaves, which also makes engines and powertrains, reported
a subsidy-related provision of 4.77 billion rupees. Its overall
one-time charge stood at 3.81 billion rupees, mainly due to a
gain from selling land.
    The company had reported a loss of 50.8 million rupees in
the previous quarter as well, as sales of its "Ampere" branded
electric scooters took a beating after the subsidy cut.
    Quarterly expenses were up 4.5%, outpacing a 4% growth in
revenue. While revenue at its biggest segment – engines – rose
20%, its electric mobility segment reported a 37% drop.
    Shares closed flat and are down 12.3% since its unit
received the government notice proposing that it be
de-registered from the incentive scheme.

($1 = 83.2458 Indian rupees)

 (Reporting by Nandan Mandayam in Bengaluru; Editing by
Subhranshu Sahu and Varun H K)
 ((Nandan.Mandayam@thomsonreuters.com; Mobile: +91 9591011727;))