Chennai, Nov 1 (IANS): Closing the second quarter of FY24 with a 64 per cent fall in its net profit, automotive wheels major Wheels India Ltd has scaled down its capex for the year, said a top company official.

The company Board on Wednesday approved incorporation of wholly-owned subsidiaries in the USA and Germany to focus on exports of off-road vehicle and tractor wheels.

Wheels India has registered a net profit of Rs 5.24 crore for the quarter ended September 30 as compared to Rs 14.53 crore in the corresponding quarter of the previous year.

“The Q2 profit was impacted due one-off expenses, notably a one-off charge for pre-delivery inspection charges,” Srivats Ram, Managing Director of Wheels India, told reporters here.

The company's revenues for Q2 went up 7.7 per cent to Rs 1,189 crore as compared to Rs 1,104 crore registered in Q2 of FY23.

Ram said the company had spent Rs 72 crore during the first half of FY24 on capital expenditure and during the second half the capex will be Rs 80 crore.

Wheels India had earlier announced that capex for FY24 will be Rs 200 crore.

According to Ram, during the second half, business is expected to gain traction and the capex to pick up steam.

He said that capex will be for expanding cast aluminum capacity, process improvements in steel wheels business and expanding the facility for machining in the wind mill business.

Wheels India has started supplying aluminum wheels to the first OEM (original equipment manufacturer/vehicle maker) and the production has more than doubled to around 24,000 per month when compared to the same period last year.

According to Ram, supplies to the second OEM in the cast aluminum segment is expected to begin in the first quarter of next year.

Ram also said volumes in the wind mill component business to pick up in the second half of this fiscal.

On the outlook for the second half, Ram said: “We expect to see export growth in the full year, despite slowdown in Europe. On the domestic front, we expect to see growth in the commercial vehicle and air suspension markets for the balance of the year. Overall, while Q3 may be muted, we expect Q4 to be stronger.”