Air conditioning and commercial refrigeration firm Blue Star Ltd recorded Q2 profit at Rs 70.77 crore, up 66 per cent as against Rs 42.64 crore during the second quarter of FY23. The profit was driven by renewed demand for its room air conditioners after the summer season which was impacted due to unseasonal rains and also a strong order book. It posted revenue from operations at Rs 1890.40 crore, up 19.5 per cent in comparison to Rs 1582.29 crore during the same period last year. While the total income during the quarter was at Rs 1903.36 crore, total expenditure during the quarter in review was at Rs 1808.37 crore.
“The corporate and commercial businesses continued to grow at a healthy pace. Moreover, margins improved across business segments due to the company’s continued focus on total cost management and stability in commodity prices and exchange rates. Further, Blue Star witnessed healthy order inflow and consequently ended the quarter with a record carried forward order book,” it said in a statement. Carried-forward order book as of September 30, 2023, grew significantly by 44.4 per cent to Rs 6008.52 crore, as compared to Rs 4162.05 crore as of September 30, 2022.
During the quarter, the company also completed the infusion of Rs 1000 crore through its first ever QIP. The company continues to invest in expanding manufacturing capacity, accelerating R&D and digitalization as a part of its growth plans and profitability improvement programmes. Consequently, the capital employed as of September 30, 2023, increased to Rs 2069.62 crore as compared to Rs 1441.16 crore as of September 30, 2022
Q2 performance across segments
Blue Star said that the revenue from electro-mechanical projects and commercial air conditioning systems segment grew by 12.1 per cent to Rs 1077.21 crore during the quarter compared to Rs 961.22 crore in the same quarter of the previous year. In the electro-mechanical projects business, while the slowdown and delay in order finalizations in the commercial buildings sector continued during the quarter, inquiries and order finalizations from factories, data centres, railway electrification, water MEP, metro railway and healthcare sectors remained buoyant.
Unitary Products revenue grew by 38.0 per cent to Rs 729.49 crore in Q2Y24 compared to Rs 528.69 crore in Q2Y23. While the second quarter has traditionally not been a strong quarter for room air conditioners, latent demand arising out of a muted summer, resulted in significant growth in the business. The growing investments in segments such as food retail, HORECA, hospitality, dairy, ice cream, processed foods and food delivery on the back of rising consumer demand drove growth in revenue of the commercial refrigeration business with significant volume growth across major product categories such as deep freezers, visi coolers, water coolers and cold storages.
The professional electronics and industrial systems segment revenue declined by 9.4 per cent to Rs 83.70 crore in the quarter compared to Rs 92.38 crore in Q2FY23 due to a slowdown in the data security business. The steady rise in corporate capex across sectors continues to drive demand and the overall prospects of this segment continue to be robust.