Transformers and Rectifiers shares fell almost 5% on Tuesday after the company reported weaker earnings for the June quarter. The stock slid as much as 6.73% during the day, hitting an intraday low of ₹311.15, before recovering to settle at ₹317.55, down 4.81%.
The company posted a consolidated net profit of ₹64.29 crore for the quarter ended June, a 5% decline from ₹67.46 crore in the same period last year. Management blamed the drop on higher raw material costs that have risen due to geopolitical tensions.
Revenue from operations increased 8% year‑on‑year to ₹572.34 crore, up from ₹529 crore a year earlier. However, revenue slipped on a sequential basis, showing a mixed picture.
Vishnu Kant Upadhyay, AVP Research at Master Capital Services, said that while revenue grew, profitability was under pressure. He noted that EBITDA margin fell 130 basis points to 19.2%, and net profit dipped 5%. The decline was largely attributed to lower capacity utilisation at the Changodar plant during its expansion.
On technical grounds, the shares have weakened after falling below the ascending trendline and both the 21‑day and 55‑day exponential moving averages. If selling pressure continues, the stock could move toward its immediate support near ₹290 and face resistance around ₹345‑350.
Total expenses for the quarter rose more than 9% to over ₹501 crore. Raw material costs, which make up 91% of total expenditure, jumped 33% year‑on‑year to ₹456 crore. A sharp reduction in finished goods inventory by ₹70.1 crore helped keep overall expenses in check.
Investors should keep an eye on raw material availability and geopolitical disruptions, which remain key factors affecting the company’s cost structure and profitability.