Cummins India’s Q1 margin disappointed despite healthy revenue growth. Pricing actions, export recovery and rising data centre demand will be key to restoring profitability.
Even so, rising demand from data centres could create a new challenge if customers increasingly shift to higher-horsepower (hp) models such as the QSK78 and QSK95 (3,500-4,500 hp) from the currently popular QSK60 (2,000-3,000 hp). While Cummins manufactures the QSK60 in India, the higher-horsepower models are imported from the US, and such a demand shift could dilute the domestic entity’s profit margins.
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