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India's BHEL reports wider quarterly loss due to weaker power demand and higher expenses

Bharat Heavy Electricals Ltd. (BHEL), a state-owned company in India, reported a larger first-quarter loss Wednesday. The decline was attributed to a lower demand for the products it produces.

The net loss of the manufacturer more than doubled from 2.13 billion to 4.55 billion (52 million dollars) for the quarter ending June 30.

India's electricity demand dropped 1.8% on an annual basis to 481 billion units between April and June as the early monsoons hindered construction activities and reduced air-conditioning requirements.

This led to a decrease in the number of project orders for electrical equipment. BHEL's revenues from this segment, which is its largest, dropped 5.6% to 38.99 Billion Rupees.

The company's revenue from operations, which represents 55% of India’s total installed capacity for power generation, was almost flat at 54.87 trillion rupees during the third quarter.

BHEL expenses rose by nearly 7%, to 62.80 trillion rupees. This was mainly due to a 10.8% increase in the price of raw materials and service.

Tata Power, BHEL's competitor, missed its quarterly profit forecasts due to weak electricity demand.

The shares of the company closed down 3.4%, ahead of results. ($1 = 87.6400 Indian rupees) (Reporting by Anuran Sadhu in Bengaluru; Editing by Savio D'Souza)

(source: Reuters)