Express Idea: Bajaj Electricals Ltd – BUY

Consumer and lighting segment witnessed lower growth due to weak demand in some products and demand slowdown. The company expects most of the segments except CFL to register strong growth going forward led by expanding its product reach into semi urban markets and higher advertisement spending. BEL also plans to revamp its Morphy Richards product portfolio to boost sales with new models in the premium segment. We expect both the division performance to improve from current levels and witnesses an EBIT CAGR of 20% over FY14‐17E. At the CMP, the company is trading at 12.1x FY16 earnings, quite lower than its peers Havells and V‐Guard and attractive considering the strong growth in earnings.

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