New Delhi: Shares in engineering goods manufacturer Cummins India traded with deep cuts in a weak Mumbai market Wednesday. The stock came under selling pressure on the back of a profit warning by is parent in the US.
The parent company cut its full-year sales forecast on Tuesday citing weaker US orders from truck and power generation customers, a stronger dollar and softer demand in emerging markets. The company said it expects second-quarter sales of about $4.45 billion and warned that it sees full-year sales "in line" with 2011 rather than growing by 10 per cent as it had earlier forecast.
"Order trends in the U.S. for trucks and power generation equipment have softened and demand in Brazil, China and India is not improving as we had previously expected," Cummins Chief Executive Tom Linebarger said in a statement.
Shares in Cummins India traded 3.5 per cent lower at Rs 433.50 on the BSE, while the Sensex was down 0.36 per cent lower at 17,554.50.
Cummins India contributes 5-6 per cent to the global business of the parent. Exports, which form 25 per cent of sales for Cummins India, were expected to grow by 5-10 per cent, but analysts now warn that the export business may be impacted. 50 per cent of India business comes from the unlisted “Tata Cummins.”
With inputs from Thomson Reuters
The parent company cut its full-year sales forecast on Tuesday citing weaker US orders from truck and power generation customers, a stronger dollar and softer demand in emerging markets. The company said it expects second-quarter sales of about $4.45 billion and warned that it sees full-year sales "in line" with 2011 rather than growing by 10 per cent as it had earlier forecast.
"Order trends in the U.S. for trucks and power generation equipment have softened and demand in Brazil, China and India is not improving as we had previously expected," Cummins Chief Executive Tom Linebarger said in a statement.
Shares in Cummins India traded 3.5 per cent lower at Rs 433.50 on the BSE, while the Sensex was down 0.36 per cent lower at 17,554.50.
Cummins India contributes 5-6 per cent to the global business of the parent. Exports, which form 25 per cent of sales for Cummins India, were expected to grow by 5-10 per cent, but analysts now warn that the export business may be impacted. 50 per cent of India business comes from the unlisted “Tata Cummins.”
With inputs from Thomson Reuters
