Cummins India shares jump 10% to hit 52-week high after Q3 results, dividend announcement

Shares of Cummins India rose sharply in Thursday's trade after declaring December quarter earnings and dividend announcement. The stock jumped 9.67 per cent to hit a day high -- also its 52-week high -- of Rs 1,618 against a previous close of Rs 1,475.35. At today's high price of Rs 1,618, the counter has gained 11.86 per cent in four sessions.

Cummins India's consolidated net profit jumped 65.79 per cent to Rs 413.80 crore in Q3 FY23 against Rs 249.60 posted in the same period a year ago. In an exchange filing, the company said total sales for the December 2022 quarter stood at Rs 2,144 crore, a surge of 26 per cent over the same quarter last year (December 2021) and by 12 per cent compared to the previous quarter (Q2 FY23).

The company also mentioned that its export sales increased by 23 per cent to Rs 541 crore on a year-on-year basis (YoY) and by 2 per cent sequentially (QoQ). Domestic sales came at Rs 1,603 crore, up 27 per cent YoY and by 15 per cent QoQ.

In addition, it has declared an interim dividend of Rs 12 per equity share on 277,200,000 equity shares (face value: Rs 2) for the financial year 2022-23. "The dividend warrants for the said interim dividend will be dispatched by March 6, 2023 and the dividend will be paid on March 8, 2023," Cummins India stated.

Around 1.11 lakh shares changed hands today on BSE, which was 10 times higher compared to Cummins India's two-week average volume of 10,000 shares. Turnover on the counter stood at Rs 17.69 crore, commanding a market capitalisation (m-cap) of Rs 44,221.72 crore. There were 3,70,070 buy orders against sell orders of 18,038 shares.

The stock was last seen trading higher than 5-day, 20-, 50-, 100- and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 73.83. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 46.40.

Cummins India has an average target price of Rs 1,215, Trendlyne data showed, suggesting a potential upside of 23.50 per cent. The scrip has a one-year beta of 0.75, indicating low volatility on the counter.

Cummins India, the country's leading producer of diesel and natural gas engines, is a large-cap company that engages in the auto ancillary industry. It has a country-wide network of 20 dealerships with over 450 service points that provides products, services, and after-market solutions for the uptime of Cummins equipment and engines to customers in India, Nepal, and Bhutan.

Meanwhile, Indian equity benchmarks were trading slightly lower in late morning deals, dragged by banks and energy stocks.

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