India's Motherson Sumi Wiring misses Q3 profit view on higher costs

Motherson Sumi Wiring India

07/02/2023 09:34

BENGALURU, Feb 7 (Reuters) - Motherson Sumi Wiring India
Ltd  MSWI.NS  reported a lower-than-expected quarterly profit on
Tuesday as a rise in operating costs and other expenses ate into
margins. 
    The company, in which Japan's Sumitomo Wiring Systems holds
a 25% stake, makes wiring harnesses and other electrical wires
that are used in various cars and automotives, as well as in
other industrial applications. 
    Motherson Sumi's profit fell to 1.06 billion rupees ($12.81
million) for the third quarter Dec. 31, from 1.52 billion
rupees, a year earlier. Analysts on average had expected a
profit of 1.26 billion rupees, according to IBES data from
Refinitiv.
    It incurred higher operating costs from a lower utilisation
of newly added capacities. Cost of materials consumed also rose
about 21% to 11.19 billion rupees.
    Motherson Sumi also said higher wages and the strengthening
of Japanese Yen squeezed its bottomline during the quarter.
    Total revenue from operations increased about 15% to 16.87
billion rupees but could not make up for rise in costs.
    The company, which in recent months added new three plants,
now expects capacity utilization at its Bengaluru and Chennai
facilities to be at optimum levels in the next quarter on the
back of improving demand from carmakers.
    "We are optimistic that in upcoming months with the stable/
growing business environment, added capacities will have a
higher utilisation," Chairman Vivek Chaand Sehgal said in a
statement.
($1 = 82.7330 Indian rupees)
 (Reporting by Ashna Teresa Britto in Bengaluru)
 ((AshnaTeresa.Britto@thomsonreuters.com ; ( +91 8078332441))