Crompton Greaves Q1 PAT may drop 19.3% to Rs 69 cr: Poll

Crompton Greaves will announce its first quarter (April-June) earnings today. Analysts on an average expect consolidated profit after tax of the company to fall by 19.3 percent year-on-year to Rs 69 crore, according to a CNBC-TV18 poll.

The drop in profit may be on account of lower losses from subsidiaries. Some analysts believe Crompton’s turnaround story will play out during April-June quarter while some still believe strain in profitability witnessed in FY12 / FY13 is likely to persist at least in the near-to-mid term.
Net sales are likely to go up by 9.4 percent on yearly basis to Rs 3,074 crore in first quarter, led by decent orderbook. Also Read - Crompton Q1: KR Choksey expects net to fall 38% at Rs 53 cr
Earnings before interest, tax, depreciation & amortisation (EBITDA) may fall 11.4 percent Y-o-Y to Rs 148 crore and EBITDA margin is seen declining 110 bps Y-o-Y at 4.8 percent in April-June quarter. Q1 Expectations
Profitability for Crompton will depend on overseas operations turnaround and mix of products/projects. Crompton’s overseas business has been dragging its overall performance, reporting losses for six quarters till March.
Some analysts believe the company could report a profit of Rs 6-10 crore in June quarter while expectations of loss are also modest at just Rs 10-15 crore. Expectations from the segments
Pressures in the domestic power systems segment is likely to result in standalone (domestic business) profitability declining 25 percent Y-o-Y to Rs 90 crore. We saw its closest competitor and market leader Havells reported a slowdown in domestic electricals business.
Analysts expect a muted topline growth for domestic power segment and margin pressures in the consumer segment.
Management commentary related to the improvement in international business would be the key thing to watch out for.