Crompton Greaves Q3 results: Net profit jumps 27.7% to Rs 110 crore

India's Crompton Greaves Consumer Electricals reported a smaller-than-expected rise in quarterly profit on Wednesday due to sluggish demand in its mainstay electric durables segment that sells fans and pumps.

Consolidated net profit increased 27.7 per cent to Rs 110 crore ($12.7 million) in the quarter, but fell short of analysts' average estimate of Rs 115 crore, according to data compiled by LSEG.

Revenue from operations climbed 4.5 per cent to Rs 1,770 crore, but the growth slowed from 6.4 per cent in the previous quarter.

The electric consumer durables (ECD) segment - which makes up about 73 per cent of Crompton's overall revenue - reported a 6 per cent year-on-year increase in revenue, compared to the 19 per cent growth a year ago.

 

Key context

Crompton has consistently raised prices of products in the ECD business, with the increase more than the industry average, analysts have said. The segment, which has seen double-digit percentage growth year-on-year in the past few quarters, reported mid-single-digit growth in the quarter. It comes amidst a broader decline in urban consumption in India.

However, results in its smaller and weaker Butterfly segment, which sells kitchen appliances improved. Revenue, which had declined on a year-on-year basis for the past few quarters, remained stable, as demand for premium products improved. Profit after tax was at 80 million rupees, compared to a loss of 20 million rupees last year.