Shares of Ahluwalia Contracts India Limited fell 7.37% on Monday morning, trading at ₹924.15 on the NSE, after the company reported a 29.77% year-on-year (YoY) decline in net profit for Q2 FY24, despite posting a 12.19% YoY increase in revenue.
Key Financial Highlights:
- Revenue: ₹1,011.48 crore, up 12.19% YoY and 10.02% QoQ.
- Net Profit: ₹38.67 crore, down 29.77% YoY, but up 26.54% QoQ.
- Operating Income: Down 26.34% YoY, but up 25.11% QoQ.
- Earnings Per Share (EPS): ₹5.77, reflecting a 29.81% YoY decline.
- Expenses: Selling, general, and administrative expenses rose 29.36% YoY and 10.01% QoQ, pressuring margins.
Market Reaction:
The decline in profitability, despite revenue growth, has raised concerns about the company’s cost management and operational efficiency. The sharp rise in expenses appears to have offset the gains from increased revenue, leading to a drop in investor confidence.
Outlook:
While the company showed positive quarter-on-quarter trends in revenue and profit, the year-on-year decline in profitability and rising expenses remain key challenges. Investors will be closely watching the company’s efforts to manage costs and improve margins in the coming quarters.
