Ranvir’s Portfolio

Crompton Greaves consumer electricals Q1 updates –

Consol Q1 outcomes –

Sales-1877 vs 1863 cr
EBITDA-186 vs 220 cr (margins@10 vs 12 pc)
PAT-122 vs 126 cr (due higher other Income)

Segment wise revenues –

ECD – 1429 vs 1347 cr, up 6 pc
Lighting – 229 vs 262 cr, down 13 pc

Butterfly – 219 vs 254 cr, down 14 pc

Segment wise EBIT and margins –

ECD – 182 vs 229 cr ( margins @ 12.7 pc down 430 bps )
Lighting – 27 vs 23 cr ( margins @ 11.9 pc, up 310 bps )
Butterfly – 16 vs 22 cr ( margins @ 7.3 pc, down 130 bps )

ECD –
Fans grew 5 pc

Pumps were flat due unseasonal rains
Geysers , Coolers, Mixer Grinders grew – 11, 10 & 50 pc
Built in kitchen appliances ( new business )- revenues stood at 11 cr

New B2C structure created for lighting business

Launched outdoor range of LED lighting

Have created a new grounds up portfolio of BLDC fans instead of just converting the older models into BLDC ones. Company feels – this segment deserves independent attention

Total sales ( of fans ) coming from premium division now at 28 pc. This division saw strong growth

A&P sales stood at 4.5 pc of sales in Q1 vs 3 pc LY … a big jump

Company’s range of BLDC fans is the widest in the Industry

In the process of merging Butterfly and Crompton go to mkt synergies. This ll massively improve Butterfly’s reach in North+West India

This should happen in next few Qtrs

Have expanded Butterfly’s product portfolio in cooking, food processing and cookware range

Demand in Apr, May was subdued. Picked up in June

Spending heavily in A&P across the organisation, specially behind butterfly brands

Currently have 54 Crompton Brand stores for sale of built in Kitchen appliances. Chimneys and Hobs showing good momentum

Company maintaining negative working capital cycle hand has been generating robust cash flows

Cash and cash equivalents stood at 783 cr vs 657 cr QoQ

Plan to enter 2-3 new segments in next 3-4 yrs. Did not disclose the name of the segments for competitive reasons

Company has improved/corrected the sub-optimal gross margins in Butterfly, Lighting business in Q1. Looking to take some price hikes in Fans in Q2 / Q3 to completely offset the costs of BEE transition

Premiumization in fans should also help drive gross margins. Current share of high value / premium fans in late 20s vs late teens a couple of years ago

Also looking to sell more ceiling lighting products vs battens/bulbs due better pricing there

Similarly, company is working hard to premiumize the Butterfly’s portfolio as well

Disc : holding, biased