Shares of Crompton Greaves Consumer Electricals Ltd are in focus after global brokerage Citi reiterated its Buy rating on the stock and maintained a target price of ₹400, implying an upside potential of about 45 percent from current levels.
The stock, which has a market capitalization of ₹17,742 crore, ended the session around ₹275, down 0.67 percent.
Demand Recovery Underway
According to Citi, demand for the company’s products has started improving following a subdued period. A stronger summer season and a low base from the previous year are expected to support revenue growth.
The brokerage noted that Crompton’s product portfolio consists largely of relatively non-discretionary categories, which tend to remain resilient even during periods of economic uncertainty.
Although consumers may delay purchases in the face of higher prices, underlying demand for products such as fans, pumps and household appliances remains intact, supporting long-term growth prospects.
Price Increases Support Realisations
The company has undertaken four rounds of price hikes in its fan business, amounting to cumulative increases of around 9–10 percent.
These measures are expected to improve revenue realisations and help offset rising input costs, although they could temporarily affect buying decisions.
Citi said management’s immediate priority is to drive revenue growth and strengthen market share rather than focus solely on margins.
The brokerage expects profitability to improve gradually, with margin recovery becoming more visible through FY27.
Q4 Business Performance
During the fourth quarter of FY26, the fans segment showed sequential improvement, supported by strong growth in BLDC fans. The company recorded its highest-ever monthly fan volumes in March 2026.
The pumps business delivered double-digit growth, aided by demand across residential, agricultural and solar categories. The company also launched the V4 Magna Series in agricultural pumps.
In the appliances segment, small domestic appliances registered strong double-digit growth. Products such as air fryers and induction cooktops continued to scale up, while mixer grinders gained market share.
Water heaters maintained a top-three position nationally in general trade, and preparations are underway for revised star-rating norms that will take effect from July 1, 2026.
Large kitchen appliances also saw increased marketing activity, while the company’s solar rooftop business continued executing existing projects, with a phased retail rollout planned from April 2026 in select cities.
Financial Performance
For the quarter ended March 2026, revenue increased 10.9 percent to ₹2,083 crore, compared with ₹1,878 crore a year earlier.
However, the company reported a net loss of ₹537 crore, compared with a net profit of ₹171 crore in the corresponding period of the previous year.
Return on capital employed stood at 19 percent, while return on equity was 10.3 percent.
The company maintained a conservative balance sheet, with a debt-to-equity ratio of 0.06, reflecting limited reliance on borrowings.
Product Portfolio
Crompton Greaves Consumer Electricals offers products across multiple categories, including:
- Fans: Ceiling, pedestal, table, wall-mounted, exhaust and industrial fans.
- Pumps: Residential, agricultural, submersible and solar pumps.
- Lighting: LED lamps, battens, floodlights and industrial lighting solutions.
- Appliances: Air coolers, water heaters, room heaters, mixer grinders, irons, kettles, induction cooktops and air fryers.
- Kitchen products: Chimneys, dishwashers, hobs, pressure cookers and wet grinders through the Butterfly brand.
Outlook
Citi expects improving demand conditions, higher product prices and gradual margin recovery to support earnings growth over the medium term.
The brokerage believes Crompton’s relatively non-discretionary product portfolio and focus on revenue expansion provide a foundation for stronger profitability from FY27 onward.
TL;DR
Citi maintained a Buy rating on Crompton Greaves Consumer Electricals with a ₹400 target price, implying 45% upside. The brokerage expects demand recovery, price hikes and margin improvement through FY27 to support future growth.
AI Summary
- Citi reiterated a Buy rating on Crompton Greaves with a ₹400 target.
- Demand recovery is being aided by a strong summer season and a low base.
- Fan prices have been increased by 9–10% through four rounds of hikes.
- Margin recovery is expected to become visible during FY27.
- Q4 revenue rose 10.9%, while the company reported a net loss of ₹537 crore.
