Shares of Elecon Engineering witnessed a sharp decline of 9.4%, trading at ₹653.60 as of 1:30 PM today, following the announcement of its Q2 FY25 results. The stock opened at ₹718.70, hit a high of ₹718.70, and touched a low of ₹643.80 during intraday trading, compared to the previous close of ₹721.45.
The fall in share price came despite the company reporting a year-on-year (YoY) revenue growth of 4.8%, with Q2 FY25 revenue rising to ₹508 crore from ₹485 crore in the same quarter last year. For the half-year ending September 30, 2024, Elecon Engineering’s revenue marginally increased by 0.1%, from ₹899 crore to ₹901 crore.
Key highlights of the Q2 FY25 financial results:
- Revenue: ₹508 crore, a 4.8% YoY increase from ₹485 crore in Q2 FY24.
- EBITDA: Declined by 5.4% YoY, dropping to ₹112 crore from ₹119 crore in Q2 FY24.
- PAT (Profit After Tax): Marginally decreased by 1% YoY, with Q2 FY25 profit standing at ₹88 crore compared to ₹89 crore in Q2 FY24.
- EBITDA Margin: Dropped by 239 basis points to 22.1% in Q2 FY25, down from 24.5% in the same period last year.
- PAT Margin: Declined by 100 basis points to 17.3% from 18.3% in Q2 FY24.
While the company’s revenue has shown growth, the drop in EBITDA and profit margins seems to have dampened investor sentiment, leading to the stock’s decline. Despite the revenue increase, the profitability metrics and shrinking margins may have raised concerns among investors.
