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Home appliances maker Crompton Greaves Consumer Electricals on Friday missed second-quarter profit estimates, as higher costs overshadowed seasonal demand for its products, which had been boosted by a weak monsoon.

The company's consolidated net profit came in at 1.01 billion rupees ($12.1 million), down nearly 23% year-on-year and well below analysts' estimate of 1.15 billion rupees as per LSEG data.

Revenue from operations was up 4.9%, while expenses rose 6.2%.

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KEY CONTEXT

India recorded its weakest monsoon since 2018 this year, as the El Nino weather pattern made August the driest in more than a century, leading analysts to eye a sales boost for the company and its peers Orient Electric, V-Guard Industries and Havells India. The company was also expected to benefit from upbeat real estate demand and hopes of a strong festive season, analysts said, citing dealers.

The company continued to battle rising costs, a trouble it has faced for the last 3-4 quarters, in what was a seasonally weaker quarter.

PEER COMPARISON

Valuation (next Estimates (next Analysts' sentiment

12 months) 12 months)

RIC PE EV/EBITDA Revenue profit Mean No. of Stock to Div

growth growth rating* analysts price yield

target** (%)

Crompton Greaves 28.68 19.81 10.37 20.27 BUY 35 0.82 1.08

Consumer

Electricals Ltd

Havells India Ltd 50.61 32.90 13.84 26.93 BUY 21 0.87 0.60

V Guard Industries 41.40 24.73 15.24 33.57 BUY 16 0.96 0.44

Ltd

Polycab India Ltd 40.59 27.45 19.02 23.18 BUY 25 0.94 0.41

* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell

** The ratio of 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 = 83.2473 Indian rupees