Crompton Greaves Consumer Electricals Ltd. share price target

Revenue stood in line with our estimate. Two-year revenue CAGR stood at 14%, driven by the ECD segment (+18%). Cost rationalization, favorable mix, and pricing action mitigated the impact of commodity cost inflation QoQ, which led to EBITDA coming in higher than our estimate, despite higher YoY employee costs and other expenses (excluding ad spends). With commodity costs inching up in 2QFY22 as well, the management addressed this via: a) product premiumization, b) cost savings (of INR480m in 2QFY22), and c) price hikes of 3-4%....

Market leader in the domestic fan industry with value market share of 24%. The company has increased focus on increasing market share in home appliances categories like (air coolers, water heater and kitchen appliances) Robust balance sheet with RoE & RoCE of 34% & 39% (three-year average), respectively, with stringent working capital policy...

markets (Jun21 exhibited growth over Jun19) and remains confident of restoring industry leading margins through 1) pricing actions (5-6% in 1Q) 2) improving business mix 3) cost saving program (Project Unnati: Rs38cr saving in 1Q22) and 4) commodity actions (advance booking of key RM at lower prices). With commodity prices stabilizing over past 1-2 months, we believe worst seems over and expect QoQ margins improvement from 2Q22. We remain structurally positive on CROMPTON for longer term given 1) market share gains across core categories of Fans, Pumps and LED lights 2)...

Crompton Gr Con (CROMPTON)'s topline stood in line with our estimates, with the strong off-take in northern and western India in June'21 compensating for muted growth in eastern and southern India. However, the two-year revenue CAGR stood at -12%, below -1% CAGR for Havells (on a like-to-like basis when comparing the ECD and Lighting segments). While gross margins stood stable YoY, the EBITDA margin declined as the management continued its spending on advertisements, R&D;, e-commerce, and other strategic areas (in line with 3Q/4QFY21)....

Crompton's FY21 Annual Report focuses on the five-dimensional growth strategy adopted over the pandemic-affected year. Launching new products and deepening the reach within existing product categories were among the key focus areas for the year...

Crompton Greaves Consumer Electrical (CGCEL) continued its growth momentum in Q4FY21 with topline, PAT growth of ~48%, ~144%, YoY, respectively, much ahead of our expectations. The company gained 1% market share in the fan segment during FY21 and retained No. 1 slot in the segment with overall market share of 27%. However, in the near term, CGCEL will witness demand challenges and EBITDA margin pressure due to lockdown, lower operating leverage and sharp rise in raw material prices. Hence, we marginally cut our revenue, earnings estimate by 5%, 4%,...

Yet another stellar quarter

CROMPTON's topline came in ~6% higher than our estimate. The beat was driven by higher revenue growth in the ECD segment, with growth across Fans, Pumps, and Appliances. Margin in the Lighting segment continued to revive and stood at double-digits for the third consecutive quarter, with sequential expansion owing to sustained volume and value growth, coupled with cost rationalization. While the management does not expect the current margin in Lighting (~15% in 4QFY21) to sustain, a lower double-digit margin is achievable. It gained market share in Fans and continued its...

CGCEL's revenue, earnings are likely to grow at CAGR of 13.5%, 15%, respectively, in FY20-23E supported by elevated margins and saving in interest outgo. We maintain our BUY rating on the stock with a revised target...

Crompton Greaves Consumer Electricals Ltd. (CGCEL) reported yet another quarter of exceptional performance.