Bajaj Electricals - Benefit Of Ongoing Growth Initiatives Likely To Be Visible FY25 Onwards: ICICI Securities

ICICI Securities Report

We met EC Prasad, Chief Financial Officer, Bajaj Electricals Ltd. Takeaways:

The company is focusing on-

1. strengthening the depth of distribution instead of mere numerical growth – it plans to roll out separate channels for lighting and Nirlep.

2. premiumising the product portfolio;

3. house of brands; and

4. growing in the existing categories rather than diversification into new categories.

We believe Bajaj Electricals has been taking several initiatives to drive growth; however, the results were likely impacted by weak macros. Improving demand conditions may change its trajectory.

We believe muted growth for the company is likely to continue in H2 FY24E but model revival in FY25E and beyond. Maintain 'Add'. at a DCF-based target price of Rs 1,140 (implied price/earning 55 times FY25E)

Key risks:

Steep increase in competition and raw material prices, and failure of new product launches.

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