Orient Electric sees virus lockdown impacting H1 2020

C K Birla Group firm Orient Electric Ltd on Tuesday said the unprecedented coronavirus lockdown will not only impact the Jan-March quarter but the effect will be seen in the subsequent three-month period as well. The company, which had reported a double-digit growth trend till February of this fiscal, is expected the results of FY 2020 “depressed”, OEL said in a regulatory filing.

“Considering the impediment caused by Covid-19, the Q4FY20 business performance of the company will get adversely impacted,” the company said. “Though the double digit growth trend continued until February 2020, however, the adverse impact of March will keep the performance result depressed for the quarter ending March 2020 and consequently pull down the annual results for FY 2020 from the reported run rate until December 2020,” it added.

According to the company, “The business disruptions arising from Covid-19 are expected to continue throughout Q1FY21 as well, if not more”. “This will not only impact OEL adversely for the peak season but also affect the industry at large,” it said.

The relaxation or withdrawal of lockdown is absolutely uncertain as of today and even thereafter, low consumer confidence leading to sluggish demand for some time coupled with slow liquidity recovery is likely to impact throughout Q1FY21. “Therefore, now with the limited visibility and knowledge, it appears that there will be unfavourable impact to the Company’s results of Q1FY21, both revenue and margins, which is difficult to predict at this time,” it added.

According to the latest report from the Union Health Ministry, the total number of COVID-19 cases climbed over 1,250 in India, while the death toll rose to 32. India is presently going through an unprecedented complete lockdown of three weeks, ending on April 14, to prevent the spread of the virus.