India`s Bajaj Electricals posts Q2 profit fall on weak demand
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India's Bajaj Electricals posted a 59% fall in second-quarter profit on Thursday, as monsoon temperatures reduced demand for cooling products.
The company, which makes products ranging from kitchen appliances to LED lights, said its consolidated net profit fell to 129 million rupees ($1.53 million) for the quarter ended Sept. 30, compared to 316.8 million rupees a year ago.
Total revenue from operations grew 0.5% to 11.15 billion rupees.
KEY CONTEXT
Demand for cooling products usually declines during July-September with the arrival of the monsoon season, which saw an above-average rainfall this year.
In addition, cost-of-living pressures strained the earnings of consumer goods companies such as Bajaj Electricals.
Analysts remain optimistic about demand revival in the December quarter, driven by festive season offers and discounts.
PEER COMPARISION
Valuation (next 12 Estimates (next 12 Analysts' sentiment
months) months)
RIC PE EV/EBI Price/ Revenue Profit Mean # of Stock to Div
TDA Sales growth (%) growth rating* analyst price yield
(%) s target** (%)
Bajaj Electricals 41.32 23.97 - 11.92 43.78 Buy 7 0.85 0.34
Havells India 58.77 39.45 4.48 15.77 23.71 Hold 23 0.86 0.54
Crompton Greaves 38.85 25.41 2.54 12.84 29.10 Buy 32 0.83 0.75
Consumer Electricals
Polycab India 44.64 32.19 4.01 19.39 18.54 Buy 26 0.92 0.44
* Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT
JULY-SEPTEMBER STOCK PERFORMANCE
-- All data from LSEG
-- $1 = 84.3550 Indian rupees)
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