India's Blue Star beats Q2 profit estimates as infra projects pick up

BENGALURU - India's Blue Star Ltd reported a better-than-expected rise in second-quarter profit on Thursday, as demand for its mechanical, electrical, and plumbing services from infrastructure projects such as metro railways picked up.

Consolidated net profit jumped 35.7% to 425.5 million Indian rupees ($5.13 million) for the three months ended Sept. 30, beating analysts' average estimates of 413 million rupees, according to Refinitiv IBES data.

Revenue from its electro-mechanical projects and commercial air conditioning systems segment increased 32.6% to 9.59 billion rupees.

"We expect order inflows in the projects segment to remain buoyant throughout the year," said Vir Advani, Vice Chairman and Managing Director of Blue Star.

A pickup in economic activity, helped by growth in infrastructure projects such as metro railways, data centres, and newly-reopened offices, has benefited the air-conditioner maker, which serves corporate, commercial, and residential customers.

Total revenue from operations rose 27% from the previous year to 15.76 billion rupees, also helped by its move to spend more on digital advertising and marketing for its consumer business.

Blue Star's unitary products revenue grew by 15.4% to 5.25 billion rupees for the reported quarter.

The company also said it is optimistic about its prospects for the second half of the year, helped by strength in its commercial refrigeration business and a softening of commodity prices.

Blue Star stock has gained nearly 21% so far this year.

($1 = 82.9200 Indian rupees)

(Reporting by Ashna Teresa Britto in Bengaluru)