Crompton Greaves - Operating Leverage, Premiumisation To Drive Margins: Nirmal Bang

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Nirmal Bang Report.Broader electrical consumer durable demand has seen a slowdown in Q2 FY25. Inflationary pressures continue to impact rural demand. Channel inventory for fans are at normalised levels, with no major pricing action done recently. Premiumisation + channel engagement + channel extraction = main strategy initiatives for Crompton Greaves Consumer Electricals Ltd. in the medium term. The company has started leveraging Butterfly’s manufacturing facilities for Crompton’s mixers and grinders, and is expected to do so for Cooktops too. B2B lighting saw slower government tendering in the current quarter, and B2C Lighting demand remains tepid (with continued value erosion).  Going forward, regulatory changes in manufacturing standards are expected to keep manufacturing cost on the higher side. However, this is also expected to expedite the shift from the unorganised to organised, with consolidations happening. While we remain structurally positive on Crompton’s long term business prospects, we maintain Hold with a revised target price of Rs 490. This implies a PE of 40 times on Sept’26E EPS and it is at par with the five-year historical average PE multiple on one-year forward basis. We believe that the multiple is fair and it adequately captures: ~25% EPS CAGR over FY24-FY26E, andpost-tax RoCE of ~18% in FY26E..Click on the attachment to read the full report:.Marico - On An Improving Trajectory: HDFC Securities.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Crompton Greaves - Operating Leverage, Premiumisation To Drive Margins: Nirmal Bang

While the brokerage remains structurally positive on the company’s long term business prospects, maintains Hold with a revised target price of Rs 490.

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Crompton Greaves - Operating Leverage, Premiumisation To Drive Margins: Nirmal Bang

While the brokerage remains structurally positive on the company’s long term business prospects, maintains Hold with a revised target price of Rs 490.

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