July-September Q3 CY2023 HIGHLIGHTS
- Strong order momentum underscores capex revival
- Step-up in revenue driven with efficient backlog execution
- Mix of effective capacity utilization with good revenue quality drive profitability
- Zero waste to landfill certification for manufacturing campus in Nelamangala, Bangalore
Commenting on the company’s performance, Sanjeev Sharma, Managing Director,
ABB India said,
“We are pleased to announce another strong quarter marked by double-digit revenue growth and continuity in order backlog buildup. We are seeing momentum in large orders intake that shows customers' preference for our energy-efficient and high-quality solutions in diverse market segments.
Central to our operations is a steadfast commitment to sustainability. A testament to this is our Nelamangala Bangalore campus, which has achieved a certification for zero waste to landfill. Aligned with ABB Group’s sustainability strategy, we remain unwavering in our dedication to meeting our ESG objectives across our campuses, factories, products and suppliers while helping ABB customers to deploy energy efficient solutions to lower GHG emissions.”
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Total orders for the quarter were at INR 3,004 crore, a 14 percent growth Y-o-Y. Electrification had a higher base order growth and strong conversion of opportunities from the renewable segment with higher penetration in the retail market. Motion’s robust growth was led by good order intake in the railway segment. Process Automation witnessed some delay in the realization of a few large orders likely to fructify in the coming quarters. Robotics and Discrete Automation posted a significant growth Y-o-Y led by paints and electronics segments.
From the market side, the quarter witnessed orders from a diverse range of segments including metals, energy companies (downstream), railways, electronics, data centers, EVs, paints, etc.
Key orders include:
- Energy efficient systems drives solutions for steel major
- Robotics automation for painting and cleaning of EVs from a leading Indian auto major
- Robotics solutions for a leading electronics manufacturer
- Gas insulated switchgear for an energy company
- Power distribution solutions for a data center company
- Compact substations for a leading private power company
- Propulsion technology solutions for a railway transportation multinational company
- Rectifiers for a global natural resources company
ABB India continues to have a strong order backlog as of September 30, 2023, at INR 8,008 crore, an increase of 23 percent Y-o-Y, which provides good revenue visibility and is well aligned to support growth plans in the coming quarters.
Revenues and operations
The Company reported INR 2,769 crore revenue for the quarter an increase of 31 percent Y-o-Y. Revenue expansion was achieved through a strong emphasis on execution, enhanced visibility via a robust backlog, a diversified revenue mix, and optimal utilization of capacity. Robotics converted a large paint order during the quarter while Process Automation also registered solid growth Y-o-Y across multiple divisions supported by surge in service and export revenue.
The quarter also witnessed the commissioning of a diverse range of projects from a mega lift irrigation project in southern India with electrification distribution solutions and Motion starter offering with converter duty transformers and PLC Marshalling Panel and robotics solutions for a paints project.
Profit and cash flow from operating activities
The company reported a Profit before tax (before exceptional items and one-offs) of INR 484 crore for the quarter, an increase of 111 percent. This significant improvement in profitability was achieved due to the enhancement of operating efficiencies, utilization of capacity leverage, and implementation of effective pricing strategies.
Profit after tax reported at INR 362 crore for the quarter, up 79 percent Y-o-Y.
The company’s cash position continues to remain robust at INR 4,356 crore at the end of Q3 2023.
The Company reported an EPS of INR 17.08 for the quarter reflecting the growth in profitability of the operations.
Sustainability in practice
In the third quarter, the Company achieved a waste recyclability of 95 percent and water recyclability of 50 percent. The smart manufacturing campus at Nelamangala achieved a zero waste to landfill certification from Intertek Sustainability. The Zero Waste to Landfill certification recognizes that the site has diverted 99 percent of its waste, including 4.93 percent of waste processed for energy recovery. A central priority of ABB’s work to preserve resources and promote circularity is achieving zero waste to landfill.
ABB India will continue leveraging increased market activity for base and large orders across segments. While doing so it will remain vigilant about fluctuating commodity prices and forex. The Company will closely monitor the impact of multiple global conflicts on global value chains and trade movement. With its extensive reach and diverse range of offerings, ABB India is poised to achieve even greater accomplishments as it integrates sustainability into all aspects of its operations. Its expertise spans a variety of sectors, including data centers, electronics, warehouse and logistics, railways and metros, pharma, food and beverage, building infrastructure, and energy companies.
ABB is a technology leader in electrification and automation, enabling a more sustainable and resource-efficient future. The company’s solutions connect engineering know-how and software to optimize how things are manufactured, moved, powered and operated. Building on more than 130 years of excellence, ABB’s ~105,000 employees are committed to driving innovations that accelerate industrial transformation.