Shares of Elgi Equipments declined by over 3% to ₹528.60 in early trading on Tuesday following the release of its Q3 FY25 financial results. The company’s EBITDA fell 7.7% YoY to ₹1,230 million compared to ₹1,306 million in the same period last year, leading to a contraction in margins from 15.8% to 14.1%.
Elgi Equipments reported a 3% YoY revenue growth, with total revenue reaching ₹8,476 million in Q3 FY25, up from ₹8,218 million in Q3 FY24. However, a sequential decline from ₹8,689 million in the previous quarter indicates challenges in sustaining revenue momentum.
Key Performance Metrics:
- Revenue: ₹8,476 million (up 3% YoY)
- EBITDA: ₹1,230 million (down 7.7% YoY)
- EBITDA Margin: 14.1% vs. 15.8% YoY
- Profit Before Tax (PBT): ₹1,106 million, down 3% YoY
- Net Profit (PAT): ₹806 million, declining from ₹839 million in Q3 FY24
The company attributed the margin compression to higher employee and material costs, which rose to ₹1,727 million and ₹4,127 million, respectively, in Q3 FY25. Despite improved revenue, these rising expenses dampened overall profitability.
Elgi Equipments has maintained its long-term growth trajectory, leveraging its global compressor business expansion and innovative product portfolio. However, the near-term margin pressure has caused cautious investor sentiment, contributing to the decline in its stock price.
Outlook: Analysts remain optimistic about Elgi’s long-term prospects, particularly in its overseas markets, but short-term challenges due to cost pressures may weigh on earnings.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
