(Reuters) – India’s state-owned Bharat Heavy Electricals reported a second-quarter profit on Monday, as higher sale of power products offset an increase in expenses, sending its shares 6.3% higher.
The power and industrial equipment manufacturer reported a net profit of 966.7 million rupees ($11.5 million) for the quarter ended Sept. 30 against a loss of 583 million rupees a year ago.
BHEL, which accounts for 55% of the country’s total installed power generation capacity, said its revenue from operations jumped 28.5% to 65.84 billion rupees in the quarter.
Revenue from the power segment, which contributes to more than 75% of BHEL’s total revenue, rose 23.5% to 50.28 billion rupees.
Its expenses rose 19% to 65.71 billion rupees, driven by an 18% rise in the cost of raw materials and services.
The company revised its year-ago adjusted expenses lower to 55.19 billion rupees from 57.53 billion rupees, including an increase in deferred tax and a reduction in provisions and write-offs, according to an exchange filing.
With limited competition in the power equipment manufacturing space, BHEL is expected to have a healthy order pipeline, according to a note by Antique Stock Broking.
Shares of the company jumped as much as 10% after results before trimming gains to trade 6.3% higher at 230.6 rupees per share. BHEL’s shares have risen around 19% year-to-date.
Rivals Tata Power and Siemens have yet to report their quarterly results.
($1 = 84.0510 Indian rupees)
(Reporting by Anuran Sadhu in Bengaluru; Editing by Mrigank Dhaniwala)
