Jan. 27 (Bloomberg) -- Bharat Heavy Electricals Ltd., India’s biggest power-equipment maker, posted a 1.9 percent increase in third-quarter profit, falling short of analysts’ estimates as utilities reduced orders.
Net income rose to 14.3 billion rupees ($290 million) in the three months ended Dec. 31, from 14.03 billion rupees a year earlier, the company said in a statement to the Bombay Stock Exchange today. That missed the 14.8 billion-rupee average estimate of 30 analysts surveyed by Bloomberg.
India’s power utilities have shelved plans for $36 billion in new plants because of soaring coal prices across Asia, stalling efforts to boost generation capacity to cut blackouts and drive expansion in Asia’s third-largest economy. State-owned Bharat Heavy is seeking an increase in import duty on equipment as it faces rising competition from Chinese rivals.
“Bharat Heavy’s order book over the last two years points to a slowdown as several orders are from utilities that have financial closures pending or have uncertain access to fuel,” Bhargav Buddhadev, vice president at Ambit Capital Pvt., said by telephone before the earnings announcement. “Their market share for equipment orders is being also being threatened by cheaper and more efficient Chinese competitors.”
Bharat Heavy shares fell 3.1 percent to 273.60 rupees at close in Mumbai trading, the biggest drop since Dec. 29. The stock has slumped 36 percent in the past 12 months compared with a 7.8 percent decline in the benchmark Sensitive Index. The earnings were announced after the market closed.
The equipment maker had 1.47 trillion rupees of orders in hand as of Dec. 31, according to a statement. That compares with 1.58 trillion rupees of orders a year earlier. Sales rose 19 percent to 105.5 billion rupees.
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