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Thermax, India's largest manufacturer of thermal insulation, beats profit forecasts on the back of strong orders and lower costs

Thermax, an Indian engineering company, reported on Thursday a profit that was higher than expected for the quarter ending June. This was boosted by a robust order increase and lower costs of raw materials and components.

According to LSEG, the net profit for the quarter ending June 30 was 1.52 billion rupees (17.4 million dollars), up 32% on an annual basis. This beat analysts' expectations of 1.34 billion rupees.

The total revenue fell by 1.6%, to 21.5 billion rupees. This was partly due to customer delays and execution issues.

The cost of raw materials fell by 11.4%, which helped boost profitability.

Bookings rose 7%, to 27,48 billion rupees. The company provides boilers and chillers, as well as water treatment and pollution controls infrastructure.

The sector leader and bigger rival Larsen & Toubro posted a 30 percent increase in consolidated profits after taxes on Tuesday.

India's clean energy and industrial engineering sector benefits from a growing government investment, infrastructure development, and a demand for green technologies.

Analysts said that firms such as Thermax and L&T are benefiting from this trend, despite input cost volatility and supply snags.

Thermax shares closed higher than 2.7% on Thursday, ahead of results. However, the stock has fallen 2.5% in the past year.

(source: Reuters)