Shares of Cummins India Ltd. tanked as much as 14% on Thursday, November 5, after the company reported its September quarter (Q2 FY27) results, with both revenue and profitability missing analyst estimates.
The company's standalone revenue from operations increased 4.1% year-on-year to ₹3,301 crore in Q2 FY27, compared with ₹3,171 crore in the corresponding quarter last year. However, revenue fell short of the analyst poll estimate of ₹3,536.5 crore by 6.66%.
Earnings before interest, taxes, depreciation and amortisation (EBITDA) declined 27.13% year-on-year to ₹507 crore from ₹695.75 crore a year ago. The figure was also 26.52% below the analyst estimate of ₹690 crore.
EBITDA margin contracted sharply to 15.36% in Q2 FY27 from 21.94% in the year-ago quarter, marking a decline of 658 basis points. Margins also missed the analyst estimate of 19.51% by 415 basis points.
Profit after tax (PAT) declined 26.69% year-on-year to ₹467 crore, compared with ₹637 crore in the corresponding quarter last year. The bottom line was 25.34% below the analyst poll estimate of ₹625.5 crore.
On the operational front, Cummins India's domestic sales increased 5% year-on-year to ₹2,692 crore, while export sales rose 2% to ₹555 crore, indicating relatively modest growth across both segments.
The company said its margin performance during Q2 FY27 was affected by commodity cost inflation. Management also highlighted that higher freight costs, coupled with a change in product mix, weighed on margins during the quarter.
Shares of Cummins India are trading 13% lower on Thursday after the results at ₹4,109.8. With this, the stock has turned negative on a year-to-date basis, now down 8% for the year.
