Cummins India : Transcript of Q3 FY 2021-22 with Analysts / Financial Institutions on February 11, 2022

Ref: STEX/SECT/2022

February 14, 2022

The Relationship Manager,	National Stock Exchange of India Limited
BSE Limited,	Exchange Plaza, 5th Floor,
Phiroze Jeejeebhoy Towers	Plot No. C/1, G Block,
Dalal Street, Fort,	Bandra - Kurla Complex, Bandra (East),
Mumbai 400001	Mumbai 400 051
BSE Scrip Code: 500480	NSE Symbol: CUMMINSIND

Subject: Intimation of transcript of analyst conference call held on February 11, 2022

Dear Sir/ Madam,

With reference to our stock exchange intimation dated February 1, 2022 towards investor/ analyst/ Financial Institution conference call, we are enclosing for your records a copy of the transcript of the said conference call conducted by the Company on February 11, 2022.

We request you to please take this intimation on your record.

Thanking you,

Yours faithfully,

For Cummins India Limited

VINAYA ABHIJIT JOSHI

Digitally signed by

VINAYA ABHIJIT JOSHI

Date: 2022.02.14 10:58:18 +05'30'

Vinaya A. Joshi

Company Secretary & Compliance Officer

Encl.: As above.

(This letter is digitally signed)

Cummins India Limited

Registered Office

Cummins India Office Campus

Tower A, 5th Floor, Survey No. 21, Balewadi

Pune 411 045 Maharashtra, India
Phone [phone] Fax [phone]
cumminsindia.com
[e-mail]	CIN : L29112PN1962PLC012276

"Cummins India Limited Q3 FY-22 Earnings

Conference Call"

February 11, 2022

MANAGEMENT: MR. ASHWATH RAM - MD, CUMMINS INDIA

LIMITED.

MR. AJAY PATIL - CFO, CUMMINS INDIA LIMITED.

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Cummins India Limited

February 11, 2022

Moderator:Good morning ladies and gentlemen. Welcome to Cummins India Limited Q3 FY22 Earnings Conference Call. We hope you all are keeping safe and healthy. As a reminder, all participant lines will be in listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call please signal an operator by pressing "*" then "0" on your touchtone phone. I will now hand the conference over to Mr. Ashwath Ram, MD, Cummins India Limited. Thank you and over to you sir.

Ashwath Ram: Good morning ladies and gentlemen. My name is Ashwath Ram, I am the Managing Director of Cummins India Limited. I hope you and your families are all doing well and staying safe. Joining me on today's call is our CFO, Mr. Ajay Patil. Thank you for joining us for the CIL Financial Results Call for Q3 2021-22.

Cummins is navigating this period of uncertainty from a position of strength and I'm happy to inform you that Q3 was a record quarter for CIL in terms of revenue, EBIT our distribution, industrial and our associate JV companies that is CGT and VCL all recorded their best ever sales. This record quarter was possible due to strong demand from our key markets like data centers, health care, infrastructure, commercial real estate and manufacturing. Gradually improvement in supply chain is another factor which helped in meeting demand for the quarter. While we do see some improvement in the supply chain, there is still quite a bit of uncertainty and constraints on semiconductors, electronic parts and quite a few other commodity linked items. As we share our organization's growth through another wave of COVID-19 our top priority will remain the safety and wellbeing of our employees and communities.

Now, I would like to share the financial results of Q3 FY22 through this call. For the quarter ended December 31, 2021 with respect to the last year same quarter our sales at Rs.1701 crore was higher by 21% compared to Rs.1200 crore recorded in the same quarter last year. domestic sales at Rs.1261 crores increased by 23% export at Rs.240 crores increased by 18%. Profit before tax an exceptional items at Rs.320 crores is 5% higher as compared to Rs.304 crore recorded in the same quarter last year. For the quarter ended December 31, 2021 with respect to sequential or last quarter, our sales at Rs.1701 crore higher by 1% compared to Rs.1689 crore recorded in the last quarter. Domestic sales at Rs.1261 crores increased by 1%. Exports at Rs.440 crores was sustained at the same level. Profit before tax and exceptional items at Rs.320 crores increased by 9% compared to Rs.293 crores recorded in the last quarter.

Segment wise breakup for the quarter ended December 31, 2021. The sales breakup segment wise are in the domestic market. Power generation domestic sales were Rs.501 crore, 21% increase over last year and 21% decrease over last quarter. Distribution business sales were Rs.450 crores, 23% increase over last year, as well as 23% increase over last quarter. Industrial domestic business sales were 291 crore, 22% increase over last year and 27% higher than last quarter.

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Cummins India Limited

February 11, 2022

Exports, higher horsepower export sales were 193 crores, 4% decrease over last year and 20% decrease over last quarter, low horsepower export sales were 216 crore, 48% increase over last

	year and 33% increase over last quarter.
	As far as Cummins India financial guidance is concerned, the company expects the current trend
	of sustained growth across industries and segments. Demand from various market and end
	markets continues to be positive. The impact of the third wave of COVID-19 is still under
	scrutiny. The company continues to work on stabilizing supply chains and part supplies.
	Considering the uncertainty, surrounding the business environment and the supply chains, the
	company will not be providing the FY22 forecast. With this, I now open the session for
	questions. Thank you.
Moderator:	Thank you very much. Ladies and gentlemen we will now begin the question-and-answer
	session. First question is from Ravi Swaminathan from Spark Capital. Please go ahead.
Ravi Swaminathan:	Sir, if you can give the break up once again for this quarter will be greater sir, because I missed
	a couple of numbers. So, power gen you told 501 crores and then in the distribution business,
	you told 250 crores?
Ashwath Ram:	The distribution business is 450 crores.
Ravi Swaminathan:	250 crores. So, compared to last year.
Ashwath Ram:	450 crores.
Ravi Swaminathan:	Okay. And industrial was 291?
Ashwath Ram:	That's correct.
Ravi Swaminathan:	And exports is 409 total?
Ashwath Ram:	Exports is 440 crores.
Ravi Swaminathan:	Got it. And sir if you can give some thoughts on what kind of price increase that we have taken
	since the first price increase that we would have taken last year on a blended basis and how much
	more price increase is needed going forward if you can?
Ashwath Ram:	So, I won't give you exact numbers on price increases, all I can say is that we have tried to keep
	up the price increases along with commodity increases, but typically this lags behind us, I would
	say it lags behind about a quarter and a half in the catch up kind of basis. So, we do see some
	back of the commodities on the margin, but we continue to increase prices to offset the
	commodity increases.

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	Cummins India Limited
	February 11, 2022
Ravi Swaminathan:	Okay. But the past 12 to 18 months we would have taken high single digit price increase, is that
	something near that?
Ashwath Ram:	It depends on the market segment. So, I can't give you one exact number but we are trying to
	keep up with the commodities that's the best way you can look at it because some segments are
	very heavily impacted by commodities some are not as much so it depends on which segment
	and which market we don't really do like a peanut butter price increase across everything, we
	go to it based on which market, which segment and how much impact we have had from a cost
	perspective.
Ravi Swaminathan:	Okay. Sir, and with respect to the Power Gen business, we have seen good growth. So, how
	much of it would be driven by key sectors like data centers, if you can give any segmental share
	across different sectors it will be really great sir in the Power Gen business, data center,
	commercial.
Ashwath Ram:	As of now we don't give segmental share because very difficult to get that information from the
	market in a live kind of basis. But, I can tell you that the sectors that I mentioned data center,
	manufacturing, pharma, healthcare, commercial reality, all of these have started to pick up pretty
	strongly. And we are starting to see some signs of bounce back even in infrastructure and some
	areas for residential reality as well.
Ravi Swaminathan:	Got it sir. And with respect to export my final question, so which geographies are seeing, are
	they seeing any pickup any specific geography that you are seeing that is seeing good traction
	oil at $90, Middle East Africa how the traction is?
Ashwath Ram:	So, just to give you a little bit of which markets are doing better, in the last quarter of the calendar
	year. Typically, most markets actually slow down a little bit as they shut down for Christmas.
	And then they ramp up a little bit slowly in the January month as they come back from Christmas
	vacation. So, Latin America was a little bit slower than the previous quarter. Asia pack continue
	to pick up and start to bounce back. Europe has been picking up quite well and has done better
	than the previous quarter. Middle East continue to pick up as you have attributed as their funds
	increase with oil price going up that business there is picking up. Africa as a market, which has
	been very subdued and they have felt the biggest impact in the global terms from all of these
	COVID crisis. They continue to languish a little bit.
Moderator:	Thank you. Our next question is from Renu Baid from IIFL. Please go ahead.
Renu Baid:	Sir my first question is, if you look at the export part of the business, despite the seasonality in
	terms of slowdown, we have managed sequentially flat numbers in revenue terms. So can you
	highlight as in which applications earlier you had spoken about Telecom as one of the key sectors
	driving growth. But in terms of end market applications, which are the sectors you think can

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