Crompton Greaves Q3 Results Review - Focus On Innovative Products Amid Tough Demand Scenario: Systematix

Systematix Report

Crompton Greaves Consumer Electricals Ltd.'s Q3 (revenue/Ebitda/profit after tax up 12%/ -2%/1%) was impacted by continued weak results of Butterfly (revenue down 6%/23% YoY/QoQ, 1% Ebitda margin).

Management is working on restructuring Butterfly’s channel mix and aims ~10% cost saving from operational integration with Crompton. A 65% YoY surge in A&P spends restricted Ebitda margins (8.8%, down 120 basis points YoY).

ECD revenue grew 19% YoY driven by Fans (up 11%), Pumps (up 28%) and Appliances (up 23%); Ebit margin contracted 227 bps YoY at 13.6%. It is now no. Two BLDC fans player.

Focus remains on premium category for Water Heaters and Air Coolers. Pumps revenue recovered (up 28% YoY), after years of weakness, driven by 39% rise in Agri segment.

Lighting revenue grew just 1% YoY despite 5% rise in LED volume as price erosion in business-to-consumer LED continues. Correction measures taken are yielding results

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