HPL Electric and Power Ltd (referred to as the “Company”; NSE: Symbol; HPL, BSE: Scrip Code;540136),an established electric equipment manufacturing company in India, manufacturing a diverse portfolio of electric equipment, announces their financial results for the quarter ended September30, 2018.
Consolidated Performance Highlights
We have carried forward the growth momentum from the first quarter as we clocked double-digit revenue growth in Q2 FY19, both on year-on-year and sequential basis.This was fuelled by 43% YoY& 30% QoQgrowth in the Metering segment, driven by strong execution and month-on-month improvement in deliveries. The Switchgear segment also contributed towards overall sales growth as it grew by 46% YoY and 4% QoQ. YoY decline in Lighting revenue was due to the high-base effect, as festive revenue was booked in second quarter last year.Metering margin decline was due to increase in polycarbonate prices, but this decline was off-set by improved margins in Switchgear and Lighting businesses which were aided by improved realisation and efficient procurement, respectively.
Steady order inflow in the metering segment along with strong execution capabilitiesprovide a positive outlook for the second half.We have recently received a Smart Meter order from one of the leading private power utilities. This indicates HPL’s recognition as one of the leading smart meter providers in the country. We expect the Trade business to perform well in the second half, driven by business growth and procurement efficiencies. We continue to engage with our dealers and partners to devise incentivisation schemes, which will help us boost our top-line.
A new electronic component manufacturing facility is in works in the Kundli plant, which will be dedicated to the Lighting segment.Our efforts towards improving our Working Capital cycle, are yielding positive results as our overall receivable days are down to 140 in September-18 from 164 in March-18, driven by reduction in non-utility receivable days from 125 in March-18 to 87 in September-18. We are ensuring strict control on our operating costs by enhancing our internal component manufacturing capabilities, which will drive margin expansion over the coming quarters.
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