Bajaj Electricals Q4 net down 99%; eyes 20% sales growth

Nachiket Kelkar

moneycontrol.com

Bajaj Electricals' fourth quarter net profit plunged 99 percent year-on-year to Rs 0.62 crore as the company continued to restructure its engineering and projects (E&P) business, amid what has been a year of sluggish growth across the sector.

The company's net sales for the three-month period gained just 5 percent from a year ago to Rs 1,114 crore.

Speaking with moneycontrol.com, Anant Bajaj, Joint MD, Bajaj Electricals said,continued to close cost overrun sites last year, which led to additional expenses.

The company has now taken all the corrective measures, closed around 12 sites, where there had been cost over runs and is now geared up for a better year ahead, he said.

Bajaj expects Bajaj Electricals' total sales to grow around 20 percent in the current financial year.

In the fourth quarter, sales from consumer durables rose 22 percent to Rs 544 crore and Lighting sales were up 15 percent to Rs 285 crore.

E&P sales, meanwhile, declined 22 percent to Rs 285 crore in Jan-March. Losses in the E&P segment were at Rs 51 crore, compared with a profit of Rs 21 crore in the year ago quarter.

“We have a clear agenda now – to complete projects on time. So if we have a project spread over 24 months, we have a internal target of doing it in 20 months or better,” Bajaj said.

The company has a order book of Rs 1,098 crore currently and there are a few more projects that the company is expected to secure, he said. This “strong” order book should help things improve in the E&P business from the second quarter onwards, Bajaj added.

Meanwhile, margins in the consumer durables and lighting segments were also under pressure last year due to volatility in commodity prices, exchange rate, low customer sentiment and tough competition.

Bajaj expects margins across the three segments to improve this year.

Bajaj Electricals shares closed at Rs 169.20 on NSE on Monday, down 0.8 percent. The stock is down 21 percent in the last one year.Read This: Bajaj Electricals eyes more than 20% growth in Q4

 nachiket.kelkar@network18online.com