NEW DELHI: Motherson Sumi Systems on Tuesday reported a consolidated net loss ₹1,191.65 crore for the quarter ended June, largely due to suspension of operations because of covid-19 pandemic and ensuing lockdowns.
Losses could have been steeper but for lower tax outgo during the quarter. The Noida-based manufacturer had reported a net profit ₹360.64 crore in the year-ago period.
Revenue during the quarter nearly halved year-on-year to ₹8,431.23 crore due to a significant fall domestic turnover. Operating loss was at ₹319.8 crore compared with a profit of ₹1,275.74 crore in corresponding quarter of last fiscal due to high fixed cost.
In India, most companies suspended operations from March 22 following a nationwide lockdown announced to curb the spread of the pandemic. Motherson Sumi also had to shut its factories located in Europe, China and other countries, either partially or fully, due to the pandemic.
According to Vivek Chand Sehgal, chairman, the pandemic has created unprecedented challenges for the global automotive industry. Lockdown in various parts of the world hit demand in the first quarter of the fiscal.
"However, even though first quarter was a washout, economies have started witnessing green shoots of recovery. Our teams and plants across the globe have also resumed operations and are working closely with our customers to fulfill their requirements. We now expect demand for the auto industry to gain momentum in the coming quarters of this fiscal year," said Sehgal in a statement.
The company announced a new corporate structure wherein the domestic wiring harness business will be hived off into a separate entity, which will be subsequently listed. As part of the new structure, Samvardhana Motherson International Limited, the holding company, will be merged with the existing entity, which will include the rest of the automotive component businesses.
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