• Orders: INR 1,104 crores, up 17.5% year-over-year.
• Sales: INR 1,193 crores, up 20.3% year-over-year.
• Gross Margin: INR 472 crores, up 30.1% year-over-year.
• EBIT: INR 155 crores, up 47.4% year-over-year.
• PBT: INR 129.8 crores, up 66.9% year-over-year.
• PAT: INR 103 crores, up 32.1% year-over-year.
• Order Backlog: INR 1,389 crores.
• Employee Costs: Increased by 10.6%.
• Other Expenses: Increased by 38.8%.
• EBITDA: INR 167.4 crores, up 44.2% year-over-year.
• Q2 Sales: INR 599.7 crores, up 21% year-over-year.
• Q2 PAT: INR 54.3 crores, up 26.7% year-over-year.

• Warning! GuruFocus has detected 4 Warning Signs with BOM:530759.

Release Date: November 18, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Schneider Electric Infrastructure Ltd (BOM:534139) reported consistent double-digit growth in both sales and orders, with a 67% increase in PBT and a 32% rise in PAT year-over-year for H1 FY25.
• The company has a strong order backlog of INR 1,389 crores, up by 14.3% compared to the previous year, indicating a robust pipeline for future sales.
• The company is leveraging emerging segments such as digital services and remote asset monitoring, which are contributing to its growth.
• Schneider Electric Infrastructure Ltd (BOM:534139) has been successful in securing significant orders from both government and private sectors, including a major order from a government-run oil and gas company.
• The company is focusing on sustainability and efficiency, aligning with global trends and India's net-zero vision, which positions it well for future growth opportunities.

Negative Points

• The company's other expenses have risen by 38.8%, partly due to increased CSR expenses and specific provisions for risk coverage.
• Employee costs have increased by 10.6%, primarily due to inflation, which could impact profitability if not managed effectively.
• There is a noted variance in the growth of industrial automation compared to energy management, with industrial automation being slightly lower.
• The company faces challenges in adapting to evolving geopolitical situations and regulatory changes, which could impact its operations.
• Despite strong order intake, the execution of projects can be delayed due to political situations and deferment of certain projects, affecting revenue realization.

Q & A Highlights

Q: How does the change in the US regime affect Schneider Electric's business prospects, particularly regarding sustainability? A: Udai Singh, Managing Director and CEO, explained that there is a growing sensitivity in India towards sustainable operations, driven by mandates like BRSR. This trend is expected to continue, offering opportunities for Schneider Electric to support industries in reducing their carbon footprint.

Q: Is there any conflict of interest between Schneider's listed and unlisted entities in India? A: Udai Singh assured that there is no conflict of interest between Schneider's various operational entities in India. Each entity operates independently without overlapping business interests.

Q: How does Schneider Electric approach clients with its wide range of products, especially for data centers? A: Udai Singh explained that Schneider Electric offers a comprehensive solution, providing a full range of products from power distribution to cooling equipment, ensuring a seamless experience for clients.

Q: What is the impact of the Government of India's reform development scheme on Schneider Electric's business? A: Udai Singh noted that the RDSS scheme, which involves significant investment in India's power infrastructure, positively impacts Schneider Electric by driving demand for their products and solutions.

Q: What is the status of the Kolkata factory, and how will it impact sales growth? A: Udai Singh confirmed that the Kolkata factory is on track to be commissioned by the first quarter of next year, which is expected to positively impact sales growth, although specific growth projections were not provided.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.