ABB India Limited (standalone) posts Q1 CY2023 results. Highest ever order growth in Q1 in the last 5 years and 5 quarters, up by 36% y-o-y.
More Details:
Highlights:
- Robust revenue growth (22%) continues
- Order backlog shows a healthy step up of 37%
- Profit before tax and exception up by 66% y-o-y, PAT up by 65% on a like to like basis
- Published the first integrated ABB India Annual Report
- Co-hosted the first ABB FIA Formula E World Championship race series in India
Orders:
- Total orders surged to INR 3,125 crore, the highest for the first quarter in the last five years. The order growth in Electrification was across major segments and channels from diverse sectors – metals, data centres, and IT majors.
- In Motion, the traction orders contributed significantly from channel partner business, railways, metals, cement, F&B and oil and gas, geographically from tier 2 and 3 cities.
- Transportation – railways and metro were also a contributor. Process Automation received orders from city gas distribution, terminal automation, life sciences, metals and energy exports. In Robotics and Discrete Automation automotive orders showed good traction with a solid inflow in paint orders.
Key orders include:
- Power handling systems for a spun-dyed specialty fiber and paints conglomerate
- Robotics solutions for painting of EV cars
- Smart power products for metals major
- Power distribution solutions for data center major and IT majors
- System drives for a diversified metals major, gas company and oil rig solutions
- Traction technology for Bhopal and Indore metros and Indian Railways
- SCADA automation, RTU, AI/ML for jetty pipeline and City Gas Distribution projects
- ABB India continues to have a consistently growing order backlog as of March 31, 2023, at INR 7,170 crore, which provides revenue visibility and is well aligned to support growth plans in the coming quarters. The company continues to invest in its facilities for meeting the growing demand.
Revenue and operations:
- The company posted a revenue of INR 2,411 crores for the first quarter, a growth of 22 percent year-on year. Electrification and Motion business areas leveraged a sound order book, seamless execution and delivery for the revenue step up.
- Motion additionally had the support of a resurgent traction converter business. Process Automation continued its success formula of milestone-based execution of project orders.
- Service revenue significantly contributed to the Robotics and Discrete Automation business area. In a bid to continue its consistent journey of investing and making in India for India and the world, ABB India, during the quarter doubled its first gas insulated switchgear (GIS) capacity by opening a new factory in Nashik.
- The eco-efficient switchgear replaces the SF6 gas with an environmentally friendly alternative which has a 99.9 percent lower global warming potential.
Profit and cash flow from operating activities:
- The company reported a profit before tax (before exceptional items and one-offs) of INR 328 crore mainly driven by higher volumes, better product mix, and higher service content. The growth in profit before tax reflects 66 percent uptrend year on year.
- The Company continued to focus on value chain improvements to address headwinds of possible commodity price changes and inflation.
- The Company reported Profit after tax of INR 245 crore at the end of Q1 2023 as compared to INR 149 crore in Q1 2022 on a like to like basis, without any exceptional items. In Q1 2022, INR 293 crore was disclosed as an exceptional item in the financial results from the sale of the turbocharger business to its wholly owned subsidiary.
- The company’s cash position continues to remain robust at INR 3,942 crore at the end of Q1 2023 vis-a-vis INR 2,707 crore in Q1 2022.
Sustainability in practice:
- During the quarter ABB, along with partners, co-hosted the ABB FIA Formula E World Championship race series in Hyderabad, a first for India. The event proved to be a success, broad basing the need for sustainable technology across groups from industries to the general citizens.
- The launch of the ecoefficient switchgear Prime Gear was a key step in the endeavour to introduce green products. In the start of the year, the green power utilisation through IRECs and RE100 progressed well while CO2 emissions also went down due to various initiatives across manufacturing locations in manufacturing and replacement of environmentally hazardous materials (gases) with neutral alternatives.
- Greater discipline in waste management led to an increase in waste recyclability to 97 percent (non-recyclable waste sent to co-processors). Zero liquid discharge from all factory locations and reusing of treated water has led to almost half of water used to be recycled.
Outlook:
- India is projected to continue as the fastest growing large economy in 2023 while the global growth as per various reports is expected to moderate through the year. The positive momentum in the country is visible from various projects under execution in Q1 2023 across multiple sectors be it manufacturing, electricity, service and utilities and mining.
- With the manufacturing sector showing a high uptick, the opportunities from projects under planning continues to demonstrate an upward trajectory. The government is aggressively pushing multiple targets of GDP growth, digital economy, exports, sustainability and clean energy through its infrastructure drive, PLI schemes, National Multi model Connectivity Plan, one district one product among others.
- ABB India with its 18 divisions across 23 market segments will remain committed to focus, enhance, and sustain presence across these segments. As India is expected to successfully navigate through the global headwinds, ABB India with its deep presence and wide portfolio is expected to create further successes while embedding sustainability in everything it does.
- In 2023, the Company will continue to enhance presence in diverse segments like data centres, electronics, warehouse and logistics, railways and metros, pharma, food and beverage, building infrastructure and energy companies.
Mr. Sanjeev Sharma, Country Managing Director, ABB India, said “We are pleased to report that the year has begun on solid footing, continuing the growth momentum set last year across orders, revenue, and profit. The first quarter witnessed our best-ever order intake as compared to Q1 of the last five years, complemented with seamless execution and delivery for our customers, resulting in consistent margin uptrend and further strengthening of a solid balance sheet. Our teams keep collaborating to serve our customers pan-India and across diverse market segments. We focus our investments in expanding our portfolio, deepening localization, capacity addition and productivity with global ABB technology and processes aligned with Make in India momentum”. “During the quarter, we continued to deliver on our sustainability targets with reduction in CO2 emissions through RE100, while 97 percent of the waste and almost half the water used was recycled”.
About ABB:
- 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 optimise 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.
Source: ABB- Press Release | Image Credit (representational): ABB
