India's Orient Electric posts smaller Q1 profit as high costs outweigh sales jump
India's Orient Electric reported a 27% fall in first-quarter profit on Thursday, as higher expenses outweighed the rise in sales of fans and coolers as the country battled with scorching heat.
Orient Electric, which also sells mixer-grinders and switchgears, said profit decreased to 143.4 million rupees ($1.7 million) in the quarter, from 196.9 million rupees a year earlier.
Revenue from operations grew by 7% to 7.55 billion rupees.
KEY CONTEXT
Rising temperatures and intense heatwaves across the country has boosted demand for cooling products, but it was offset by higher costs of traded goods, hitting the company's bottomline.
Indian home appliance makers have delivered a largely mixed set of earnings, setting up a balancing act between bolstered demand and higher costs of raw materials like copper and aluminium.
Last month, Crompton Greaves beat quarterly profit estimates, helped by rising demand for fans and coolers, although Havells India missed estimates as expenses surged.
PEER COMPARISON
Valuation(next 12 Estimates (next 12 Analysts' sentiment
months) months)
RIC PE EV/EBI Revenue Profit Mean # of Stock to Div yield
TDA growth (%) growth rating* analyst price (%)
(%) s target**
Orient Electric 47.17 24.20 13.97 45.08 Buy 15 1.13 0.52
Havells India 65.33 44.37 20.25 26.78 Buy 21 0.98 0.49
Crompton Greaves 45.44 29.91 12.21 30.78 Buy 31 0.99 0.66
Consumer Electricals
Polycab India 47.99 33.02 17.99 19.27 Buy 24 0.99 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
APRIL-JUNE STOCK PERFORMANCE
-- All data from LSEG
-- $1 = 83.7150 rupees
